Indian share markets continued to trade well above the dotted line in the afternoon session amid firm international markets. At the closing bell, the BSE Sensex closed higher by 83 points and the NSE Nifty finished higher by 15 points. The S&P BSE Mid Cap finished down by 0.1% while S&P BSE Small Cap finished up by 0.2%. Gains were largely seen in automobile sector and PSU sector. Selling activity was seen in metal stocks and pharma stocks.

Small caps have comfortably outperformed the Large caps and how. The BSE Small Cap Index has returned 21.7% in FY18 compared to 12.5% by BSE 100 and 11.7% by the Sensex.

Small Caps – Outperformers in Current Financial Year

Expectedly, valuations of certain Small cap companies have gone through the roof. It is important to understand the highly volatile nature of these stocks. In a downturn, these stocks tend to move in the opposite direction much faster as well.

While there, undoubtedly, lies hidden opportunities in the small cap space, it is important to focus on fundamentals of these stocks. Next, assess if they have the potential to move on to the ‘Safe stock’ category in the future.

Asian stock markets finished higher today with shares in Hong Kong leading the region. The Hang Seng is up 0.62% while China’s Shanghai Composite is up 0.59% and Japan’s Nikkei 225 is up 0.48%. European markets are mixed. The FTSE 100 is higher by 0.27%, while the DAX is leading the CAC 40 lower. They are down 0.21% and 0.12% respectively.

Rupee was trading at Rs 64.75 against the US$ in the afternoon session. Oil prices were trading at US$ 57.83 at the time of writing.

In news from oil & gas sector, as per an article in a leading financial daily, Oil and Natural Gas Corp (ONGC)’s overseas arm ONGC Videsh Ltd (OVL) has acquired 15% stake from UK’s Tullow Oil in an oil block in Namibia. Notably, this is OVL’s second acquisition in as many months in the African nation.