Markets Stay Weak, Midcaps Shine – What Should Investors & Mutual Fund Holders Do?

How the Market Performed Today

• Nifty 50 closed at 25,082, down 0.27%, marking its fourth consecutive loss.

• Sensex fell by 247 points, dragged by weakness in IT and financial stocks.

• In contrast, mid-cap and small-cap indices outperformed, gaining 0.7–1% and showing strong investor interest beyond blue-chip names.

Sector & Stock Dynamics

• The IT sector was the biggest drag. Major players like TCS, Infosys, and Wipro continued to face pressure due to weak earnings and cautious commentary.

• On the positive side, sectors like realty, pharma, healthcare, auto, and media saw strong buying interest.

• Notable stock movers included Landmark Cars (+6%), Suprajit Engineering (+3%), Hindustan Zinc (+3%), and JP Power (+13%).

• Meanwhile, Maruti Suzuki and Power Grid underperformed among large-caps, while SBI showed slight strength.

Macro & Global Cues

• Market sentiment was affected globally after the U.S. announced a 30% tariff on goods from the EU and Mexico starting August 1.

• The Indian rupee fell to its lowest level in two weeks, touching ₹86.99 per USD, due to strong dollar demand and continued equity outflows.

• Investors are also awaiting inflation data (CPI and WPI) which will play a key role in RBI’s next policy outlook.

Mutual Funds & Investment Trends

• SIPs & Fund Flows

• Over 112 lakh SIPs were closed in 2025 so far, showing some short-term investor concern. However, overall equity mutual fund inflows jumped by 24% in June, crossing ₹23,000 crore.

• Hybrid fund inflows also remained strong, with total flows across categories nearing ₹49,000 crore for the month.

• Major AMCs like SBI, ICICI Prudential, HDFC, Kotak, and Nippon saw large inflows, each adding over ₹15,000 crore in assets.

Investment Patterns

• Mutual funds invested over ₹39,000 crore in equities in June, including block deals and anchor investments in IPOs.

• Fund houses also trimmed their cash holdings by ₹13,000 crore, signaling increased equity deployment.

• While 20 new fund offers (NFOs) launched in June, equity mobilization fell 52% due to investor fatigue and market volatility.

What Should Investors & Mutual Fund Holders Do?

For Stock Market Investors

• Stay selective, especially in the IT and BFSI sectors, which are under pressure.

• Mid-cap and small-cap segments are showing strength — look for fundamentally strong, reasonably valued picks.

• Don't panic-sell during corrections; use technical support levels (like Nifty 24,900) as indicators, not triggers.

• For short-term traders, stocks like Suzlon Energy, Glenmark Pharma, and select PSU names might offer momentum opportunities this week.

For Mutual Fund Investors

• If you’re running SIPs — stay consistent. Volatility is normal and can help average out costs in the long run.

• New investors can consider balanced or flexi-cap funds, which offer growth potential with relatively lower risk.

• Those with lump-sum amounts can use the STP (Systematic Transfer Plan) route to enter equity gradually.

• Be cautious with new NFOs unless the fund’s theme or track record justifies your investment.

• Keep a long-term view. Don’t switch to debt just because of short-term market weakness.

Final Thoughts

Despite global uncertainty and domestic market volatility, India’s long-term growth story remains strong. Mutual fund flows, IPO enthusiasm, and retail participation are providing a cushion against FII outflows and sector-specific weakness.

Stay focused, stay diversified, and stick to your financial goals — whether you’re investing directly in stocks or through mutual funds.