Fiscal 2024 has come to an end with a lot of churn in the broader market, which spilled, to a certain extent, onto the largecap stocks as well.

If we look at the overall year, it was a rewarding period for Indian investors, where large caps rallied substantial 33%, midcaps surged by 56%, and small caps excelled with an impressive 63%, as indicated by the respective indices.

But, FY24 ended on a subdued note following Sebi chief’s warning of expensive valuations, which resulted in substantial selling pressure at times.

During the month, 50 smallcap stocks delivered double digit returns to investors with the top gainer Rico Auto Industries rallying up to 40%. There was no single multibagger across the market during the month under review.

Only three stocks — Rico Auto Industries, eMudhra and Waaree Renewable — delivered over 25% returns in the said period.

Midcaps too underperformed a tad bit with only 8 stocks offering double-digit returns to investors. Solar Industries, with a gain of 30%, was the topper in the segment, followed by Torrent Power at 25% and CG Power at 21%.In the midst of turmoil in the broader market, largecaps were seen as a safe haven and started finding favour among more and more investors, reflected in over 1% rise in the benchmark BSE Sensex.Maruti Suzuki and Bajaj Finance led the rally in the 30-share pack, which rose just over 11% each and Tata Steel was the close follower with 10.6% jump in its shares.

Three sectors that ruled the roost during the month include capital goods, auto stocks and metal stocks. While the capital goods index gained over 6%, auto and metal components rallied nearly 5%.

Within the capital goods segment, CG Power and Carborundum Universal were among the top gainers, followed by ABB India and Thermax.

What to look forward to?

Despite uncertainties persisting, analysts said there has been some relief in the market in recent trading sessions as the pressure from leveraged selling has eased and buying activity has improved, albeit at lower volumes.

In the first week of April, investors will await key economic data in the likes of PMI in the US and India, factory orders, and unemployment data in the US.

Additionally, market participants will closely monitor signals regarding policy rates, particularly from the Reserve Bank. With the end of March quarter comes the anticipation of fourth quarter results and updates, which might be worth keeping an eye on.

Amid numerous factors that are likely to influence the markets going forward, the focus is on large caps, as analysts expect the premium valuation of midcaps could have a hiccup in the short to medium-term.

As we move on to a new financial year, Vinod Nair of Geojit Financial expressed optimism towards sectors such as pharma, capital goods, and infra, he sees them as key growth drivers, supported by both domestic and external demand.

“Although some sectors like FMCG and IT are facing challenges due to subdued demand at present, analysts anticipate a turnaround, driven by expectations of a normal monsoon and increased US demand following the Fed’s rate cut,” Nair said.

“With the start of general elections in April, we believe government-centric stocks to be in focus. Auto stocks are likely to be in the limelight next week amid the release of monthly auto sales numbers,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal.