Indian equities saw broad selling in the latest session, with smaller companies hit hardest.

The Nifty Smallcap 100 fell 2.37% to 18,487.30, the Nifty Midcap 100 dropped 1.58% to 57,565.85 and the Nifty Next 50 lost 1.51% to 67,655.30. Large caps held up better: the Sensex slipped 0.19% to 73,709.69 and the Nifty 50 lost 0.34% to 22,811.35. The BSE 500 and Nifty 500 fell 0.95% and 0.92%.

The year-to-date picture is still mixed. Large caps are down, with the Sensex off 13.51% and the Nifty 50 off 12.70%. Smallcaps are ahead, with the BSE SmallCap index up 8.13% and the Nifty Smallcap 100 up 4.37%. Midcaps trail both groups, with the BSE MidCap index down 4.04% and the Nifty Midcap 100 down 4.83%. Month to date, the Sensex is up 1.70% while the Nifty Smallcap 100 has dropped 3.94%.

Recent momentum has turned against smaller companies. Over six months, the BSE SmallCap index is up 9.97% and the Nifty Smallcap 100 is up 2.84%, while the Nifty 50 is down 4.94%. Over the past month, though, the Nifty Smallcap 100 has fallen 6.70% against a 2.22% decline for the Nifty 50. Midcaps have been weak across most periods, with the Nifty Midcap 100 down 7.10% over one month and 6.58% over three months.

This looks like a rotation out of smaller stocks into larger ones, driven by profit-taking and a more cautious mood. Large caps may be stabilising, but their year-to-date losses are still above 12%. The persistent weakness in midcaps raises questions about how broad the market’s participation is. Investors should watch whether large caps can keep their relative strength or whether weakness in the wider market returns. Three-month and six-month returns are still negative for most indices.