Are Midcap & smallcaps readying to rally?
Published On: Thursday, July 2, 2020 | By: Team KnowMyStock
Some selected smallcap and midcap stocks such as Balkrishna Industries, Deepak Nitrite, Rallis India, and Bajaj Electricals, etc. may deliver up to 26 percent return to investors during the second half of 2020, according to ICICI Securities. The brokerage says after a lull of more than 24 months, the broader market is on the cusp of the next major bull market. The BSE Midcap and BSE Smallcap indices have corrected 29 percent and 38 percent, respectively, from their respective all-time high scaled in January 2018. Benchmark Sensex is down 16 percent from its lifetime high of 42,273, scaled on January 20 this year.
“The relative ratio of mid and smallcap indices/ Nifty is at a cyclical low, and is turning up, signifying outperformance ahead after a two-year-long bear phase,” the brokerage said, adding that investor sentiment as represented by 14-month RSI (momentum oscillator) at less than 35 is at a major cyclical low, which was last observed in CY08 and CY13. In both instances, such readings laid the foundation of the next major bull market.
Source: https://economictimes.indiatimes.com
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