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Broader indices decline in October, with Microcaps (-8.95%) and Smallcaps (-5.81%) witnessing sharper falls than Midcaps (-3.75%) and Nifty Next 50 (-2.92%), says Motilal Oswal.
Stock Markets.
The Nifty emerged as the best-performing market-cap index in October 2026, gaining 1.91%, even as broader market segments came under pressure, according to Motilal Oswal Mutual Fund’s Global Market Snapshot report.
The benchmark index was the only one among the major market-cap indices covered in the report to deliver positive returns during the month. In contrast, the Nifty Next 50 declined 2.92%, while the Nifty Midcap 150 fell 3.75%.
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“Nifty 50 gained 1.91% in October, while broader market-cap indices declined, with Microcaps (-8.95%) and Smallcaps (-5.81%) witnessing sharper falls than Midcaps (-3.75%) and Nifty Next 50 (-2.92%),” Motilal Oswal said in its report.
The correction was sharper in the smallcap and microcap segments. The Nifty Smallcap 250 dropped 5.81%, while the Nifty Microcap 250 plunged 8.95% in October. The Nifty 500, meanwhile, declined 0.80%, highlighting the relative resilience of large-cap stocks amid broader market weakness.
IT leads sectoral gains; Metal stocks emerge as biggest laggards
At the sectoral level, Information Technology (IT) was the strongest performer, rallying 17.69% in October. Healthcare also ended higher, gaining 1.93%, while the Bank index edged up 0.10%.
However, most other sectors remained under pressure. Metal was the worst-performing sector, declining 7.65%, followed by defence, which fell 6.17%. Consumer durables dropped 5.74%, while energy and realty declined 4.58% and 3.95%, respectively.
Auto stocks lost 3.31%, while FMCG declined 2.02%. Overall, only three of the 10 sectors covered in the report delivered positive returns during the month.
Low Volatility outperforms other factor indices
Among factor-based indices, Low Volatility proved relatively resilient, declining just 0.79% in October. Momentum and Quality indices fell 2.41% and 2.73%, respectively, while Enhanced Value recorded the steepest decline of 2.90%. All four factor indices ended the month in negative territory, according to Motilal Oswal.
IT, telecom and healthcare support Nifty 500
The Nifty 500 declined 0.80% in October, with Industrials, Commodities and Consumer Discretionary emerging as the biggest drags on returns, contributing -0.54%, -0.54% and -0.42%, respectively, according to the report.
On the other hand, IT made the strongest positive contribution of 0.99%, followed by Telecommunications at 0.32% and Healthcare at 0.10%. These were the only three sectors to make positive contributions to the index’s performance.
Global markets: Nasdaq 100 falls 6.65%; Korea plunges 15.57%
Global equity markets also witnessed mixed trends in October. In the US, the Dow Jones Industrial Average gained 1.70%, while the S&P 500 declined 0.93%. The Nasdaq 100 underperformed, falling 6.65% during the month.
Over the one-year period, the S&P 500 delivered a return of 10.82%, followed by the Nasdaq 100 at 9.77% and the Dow Jones Industrial Average at 8.85%.
Information Technology and Communication Services were the biggest drags on US market performance, contributing -2.77% and -1.49%, respectively. Healthcare and Financials provided support, contributing 0.92% and 0.67%, respectively.
Emerging markets recorded broad-based declines, with South Korea witnessing the steepest fall of 15.57%. Brazil declined 12.11%, while Taiwan and China fell 8.37% and 7.17%, respectively. South Africa lost 4.14%.
Developed markets presented a mixed picture. Switzerland led the gains with an 8.32% rise, followed by the UK at 2.25%. Japan and France, however, declined 4.18% and 1.73%, respectively.
Crude oil jumps 15.15%; gold declines 6.30%
In commodities, crude oil prices surged 15.15% during October to $104.12 a barrel. Gold moved in the opposite direction, declining 6.30% to $3,913 an ounce.
The Indian rupee strengthened against the US dollar, with the USD/INR exchange rate declining 0.92% to close at 94.95.
Cryptocurrency markets also remained under pressure. Ethereum fell 9.65%, while Bitcoin declined 7.51% during the month.
Domestic macroeconomic indicators
On the domestic macroeconomic front, India’s Consumer Price Index (CPI) inflation rose to 5.54% from 4.83%, according to the report. The repo rate increased to 5.50% from 5.25%, while the 10-year government bond yield climbed to 7.40% from 7.16%.
Foreign institutional investors (FIIs) remained net sellers of Indian equities, withdrawing Rs 24,475 crore during the period. However, the outflow was lower than the Rs 58,443 crore recorded a month earlier. Domestic institutional investors (DIIs) also recorded net outflows of Rs 28,943 crore.
In the US, CPI inflation increased to 3.70% from 3.40%, while the US Federal Reserve kept its target interest rate unchanged at 4.00%.
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Ask News18In October 2026, the Nifty emerged as the best-performing market-cap index with a gain of 1.91%, while broader market segments faced sharp declines, including a 5.81% drop in smallcaps and an 8.95% plunge in microcaps.
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