In a steep fall from 400, only 25 smallcaps offer double-digit weekly returns

was the top gainer in the smallcap pack with nearly 36% return, followed by (33%), (26%), and Transformers (17%).

About 22 stocks, including , , , , Motilal Oswal, Hariom Pipe have offered returns between 10-20% during the week.

In the midcap segment, three stocks including , Gujarat Fluorochemicals, have risen in double digits. While Exide gained 24%, and Petronet LNG were up over 23% and 12.6%, respectively.

From the Sensex pack, topped the charts with 2.8% returns, followed by M&M at 2.7% and at 2%.

During the week, foreign investors were cautious given the subdued expectations for Q4 corporate earnings and the premium valuations of mid- and small-cap stocks.

Analysts said profit-taking is also evident in banking stocks, particularly in PSU banks, as the banking sector’s loan growth is moderating, and valuation has surpassed long-term averages. Conversely, the auto and realty sectors are showing resilience, driven by expectations of strong earnings momentum.

What should investors do?

With the start of fourth quarter earnings season, investors will closely monitor the numbers along with other geopolitical events, which may have a bearing on the market direction going forward.

"Large-cap stocks are viewed as safer bets amidst heightened volatility given stable earnings outlook and valuation," said Vinod Nair, Head of Research at Geojit Financial Services.

"We expect markets to remain volatile in the near term given the global concerns and the start of an election next week. With the onset of the earnings season, the focus will shift more toward domestic cues along with macro data points. Markets on Monday will react to India’s inflation data and TCS Q4 numbers, which were released on Friday," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal.

Technically, the index is in the process of retracing the rise it has witnessed from 22710–22776.

"The next crucial support level stands at 22370. On the upside 22620 – 22650 shall act as an immediate hurdle from a short-term perspective," said Jatin Gedia of Sharekhan.

(With data inputs from Ritesh Presswala)

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)