Small-Cap Index Crash: 5 Key Reasons

Indian stock market suffers a blow as small-cap index dives over 1000 points, touching intraday low of ₹44,476.

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Profit Booking

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Overvaluation

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Middle East Tension

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Lower Liquidity

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Sell-off in Key Sectors

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Small-Cap Index Crash: 5 Key Reasons

Indian stock market suffers a blow as small-cap index dives over 1000 points, touching intraday low of ₹44,476.

Profit Booking

After a strong rally, investors cashed out of small-cap stocks to lock in profits, leading to a sell-off.

Overvaluation

Small-cap stocks were deemed overpriced compared to larger peers, making them vulnerable to correction.

Middle East Tension

Geopolitical jitters pushed investors towards safer bets like large-cap stocks, shunning small-cap risk.

Lower Liquidity

Small-cap stocks' lower liquidity makes them more susceptible to sudden price swings and volatility.

Sell-off in Key Sectors

PSU, banking, railway, and defense stocks witnessed heavy selling, dragging down the entire small-cap index.