Dents in the smallcap routing Volumes of Indian stocks amid large block transactions

India’s equity trading volumes have dropped to their lowest point since December as institutions are snapping up big transactions while regular investors’ rush into the country’s $4.3 trillion market is being slowed by a selloff in smaller businesses’ shares.

According to statistics published by Bloomberg, the daily cash trade volume has decreased to $10 billion from a record $19 billion in early February. The majority of the reduction may be attributed to recent sessions.

Local shares have declined as a result of warnings from India’s securities regulator that small caps are overheating; this month, the index of these companies has down more than 6%. Since individual investors are usually the ones driving cash volumes, it is probable that they will wait to make new purchases until the market stabilises, which will keep trading activity low.
“Retail investors were caught on the wrong side,” according to Ashish Kyal, founder of Waves Strategy Advisors Pvt., and they often remain cautious until a distinct trend develops.
Institutions continue to have a high hunger for major acquisitions, notwithstanding the general market slump. According to the statistics, block transactions have exceeded $7 billion this year and are on track for their highest quarter in 14 years.