Smallcap stocks took a big hit on July 8. Many shares dropped sharply, with some losing up to 6%. It was a red day for both midcap and smallcap indices.
This is the third straight day of losses for the Nifty Midcap index. For smallcaps, it was the second day in a row. In comparison, the Sensex and Nifty moved very little, staying mostly flat.
Capital Market Stocks See the Worst Fall
The biggest fall came from capital market stocks. This follows SEBI’s ongoing crackdown on Jane Street, which is under fire for using unfair trading strategies in India.
Angel One and MCX shares crashed by nearly 6%. CDSL also dropped over 2%. The pressure worsened after reports said SEBI may tighten the link between options and cash markets. This could affect how money flows in the market.
On the midcap side, BSE was the biggest loser. It sank over 6%.
Pharma Stocks Also Bleed
Pharma stocks joined the fall. The reason? A sudden shock from the US.
On July 7, US President Donald Trump sent out letters to about 14 countries, including India. These letters outline new import tariffs starting August 1. More such letters are expected soon.
This move worried investors who were hoping India would close a trade deal with the US soon.
Aurobindo Pharma, Lupin, and Alkem Labs dropped up to 4%. Macquarie downgraded Aurobindo to “underperform” and slashed its target price by 40%. It also cut Lupin’s target price but kept an “outperform” tag.
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Defence Stocks Lose Steam
Defence stocks, which were hot earlier, also slipped. Global tensions have cooled recently, so investors booked profits.
Solar Industries and Cochin Shipyard lost almost 2% each. On the smallcap side, GRSE and BEML also dropped around 2%.
Other Big Losers
It wasn’t just the big names. A mix of other smallcap stocks and midcaps were hit hard:
Paytm, IRCON, Go Digit, Kaynes Tech, MGL, Bharti Hexacom, Bandhan Bank, Ola Electric, Union Bank, Kalyan Jewellers and others fell noticeably.
What Analysts Say
Emkay Global gave a cautious view. It said India’s economy is still recovering. While some areas are doing okay, overall growth is weak.
“Markets may stay quiet for now,” Emkay added. “We expect things to improve in the second half of FY26.”
So, if you’re into smallcap stocks, this is a moment to stay sharp. Volatility is back, and signals are mixed.
Disclaimer:
This article is for informational purposes only and is not financial advice. Please consult a certified advisor before making investment decisions.
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