The Nifty Midcap 100 on Tuesday rose 0.54 per cent to hit a fresh all-time high of 62,299, even as benchmark indices declined amid fresh US strikes on Iran, which dampened hopes of a peace deal. The Sensex ended the session at 76,009.70, down 479 points or 0.6 per cent, while the Nifty closed at 23,914, down 118 points or 0.5 per cent.
The resurgence in geopolitical tensions pushed Brent crude prices up 2.5 per cent to $96 per barrel. The rupee depreciated 0.5 per cent to 95.7 against the dollar.
The Nifty Midcap 100 has gained 18.3 per cent so far in the current financial year. While the midcap index touched a record high, the benchmark Sensex remains 11.4 per cent below its peak, while the Nifty is 9.2 per cent lower. The Nifty Smallcap 100 is still 7.2 per cent below its all-time high.
The total market capitalisation of BSE-listed firms stood at Rs 468.7 trillion, marking an increase of Rs 17,444 crore. So far in 2026, foreign portfolio investors (FPIs) have been net sellers of Indian equities worth Rs 2.3 trillion.
Market experts said investors are gravitating towards midcaps because of their sectoral diversity, which offers unique thematic and bottom-up investment opportunities. Experts also pointed out that this segment is relatively insulated from foreign portfolio investor (FPI) selling.
“Mid-cap stocks are currently outperforming because they are not the typical FPI favourites. Foreign funds have largely been selling large-cap names such as major banks and other index-heavy stocks, which has weighed on benchmark indices and overall sentiment. Mid-caps, on the other hand, are driven more by domestic retail and HNI investors, who are effectively ‘having a party of their own’,” said U R Bhat, co-founder of Alphaniti Fintech.
Bhat added that while valuations in the mid-cap space may appear stretched, earnings growth has been significantly stronger than that of large-caps.
“Midcaps will continue to rise. They are not affected by the rupee’s fall or FPI selling, and they offer unique ideas and deep value. Moreover, lakhs of new retail investors enter the market every week. DIIs also seem to be buying midcaps where FPI positions are relatively low,” said Chokkalingam G, founder of Equinomics.
“Mid-caps offer greater sectoral diversity and more company-specific growth stories. Investors are also attracted by the potential for successful mid-caps to eventually become large-caps and enter benchmark indices. Additionally, strong inflows into mid-cap mutual funds have further boosted demand, as these funds are mandated to deploy capital within the segment. As for small-caps, although earnings growth has been healthy, investors appear to prefer the relatively safer and more established mid-cap universe. Small-caps are still some distance away from their all-time highs because investors are seeking a balance between growth and stability,” said Bhat.
Market breadth remained mixed on Tuesday, with 2,139 stocks declining and 2,067 advancing. Going forward, the geopolitical situation is likely to determine the direction of the midcap universe.
Experts said rising crude oil prices due to ongoing conflicts could increase transportation, energy, and input costs across industries, thereby affecting corporate profitability. If the situation worsens, investors may reassess their investment strategies and risk appetite.