Small and micro-cap stocks have rebounded significantly since the onset of the West Asia conflict, with the Nifty small-cap 250 index rising 2% and the micro-cap index up 4.5%. In contrast, blue-chip stocks continue to struggle due to foreign investor aversion, with foreign institutional investors selling over ₹1.6 lakh crore worth of shares.

• 01Small and micro-cap stocks have recovered from earlier losses, driven by local investor interest.
• 02The Nifty small-cap 250 index is up 2%, while the micro-cap index has risen 4.5% since the conflict began.
• 03Blue-chip stocks remain under pressure, down 3.9%, as foreign institutional investors continue to sell.
• 04Domestic institutional investors have purchased shares worth ₹1.77 lakh crore, supporting the recovery of smaller stocks.
• 05Valuations for small and mid-caps have moderated, making them more attractive to investors.

The recovery in small and micro-cap stocks may provide opportunities for local investors, while blue-chip investors face uncertainty due to foreign selling.