Indian share markets witnessed volatile trading activity throughout the day today and ended lower.

Benchmark indices recovered some lost ground after sliding 700 points but still ended lower dragged by Reliance Industries and Infosys.

At the closing bell, the BSE Sensex stood lower by 336 points (down 0.6%).

Meanwhile, the NSE Nifty closed lower by 89 points (down 0.5%).

Kotak Mahindra Bank and Tata Motors were among the top gainers today.

Asian Paints and Hindalco, on the other hand, were among the top losers today.

The SGX Nifty was trading at 18,242, down by 75 points, at the time of writing.

The BSE Mid Cap index and the BSE Small Cap index ended down by 0.4% and 0.7%, respectively.

Sectoral indices ended on a negative note with stocks in the IT sector, metal sector, and telecom sector witnessing most of the selling pressure.

Banking and finance stocks, on the other hand, witnessed buying interest.

Shares of Union Bank and Rail Vikas Nigam hit their respective 52-week highs today.

Asian stock markets ended on a mixed note today as investors weighed more positive earnings against ongoing concerns about inflation and central bank tapering.

The Hang Seng ended down by 0.5%, while the Shanghai Composite ended up by 0.2%. The Nikkei ended down by 1.9% in today's session.

US stock futures are trading on a negative note today with the Dow Futures trading down by 92 points.

The rupee is trading at 74.86 against the US$.

Gold prices for the latest contract on MCX are trading up by 0.2% at Rs 47,586 per 10 grams.

In news from the paints sector, Asian Paints was among the top buzzing stocks today.

Asian Paints shares fell nearly 6% today after the company reported a 28% year-on-year (YoY) decline in consolidated net profit for the quarter ended September to Rs 6 bn, which was sharply below analysts' estimate.

The paint manufacturer's consolidated revenues in the quarter grew by 32.6% YoY to Rs 71 bn.

The decline in the company's bottom line was largely due to a sharp spike in expenses during the quarter. Asian Paints' total expenses jumped 49% YoY to Rs 64.2 bn led by a 73% rise in the cost of raw materials.

The decline in the bottom line came despite a 25% YoY fall in tax expenses and a 67% jump in other income during the reported quarter.

Amit Syngle, MD and CEO at Asian Paints in a press statement said,

• Steep inflation seen in raw material prices, since the beginning of this calendar year, has been phenomenal and has impacted gross margins across all businesses in the quarter.
  
  The company will look at further price increases going ahead to mitigate the impact of 'this persistently high inflation.

He also said the company is confident of turning around the situation in the coming quarter.

The impact of the surge in input cost was felt in the company's operating performance as consolidated operating profit sank 28.5% YoY to Rs 9 bn. The country's largest paint maker saw its consolidated operating margins shrink 1,080 basis points YoY to 12.8%.

The company's board also approved an interim dividend of Rs 3.65 per share at its meeting held earlier today.

Asian Paints share price ended the day down by 4.9% on the BSE.

Moving on to news from the retailing sector...

Shoppers Stop Rallies 20% After Upbeat Quarter Two Results

Shares of Shoppers Stop zoomed as much as 20% on the BSE today after the company reported a strong set of numbers in the September 2021 quarter.

The retail chain reported narrowing of its consolidated net loss to Rs 3.68 crore for the September quarter, helped by a comeback in sales. The company had posted a net loss of Rs 977 m in the July-September period a year ago.

Revenue from operations rose over two-fold to Rs 6.4 bn from Rs 3 bn in the same quarter of the previous fiscal.

Shoppers Stop MD & CEO Venu Nair said,

• The demand postponement triggered by the second wave of the pandemic witnessed a strong comeback in quarter two.
  
  The festive sales have been extremely reassuring as the company has recovered more than 100% sales in the east, followed by north. During the July-September quarter, sales from omni-channel grew by 103%.

Shares of Shoppers Stop have soared as much as 35% in the last month, whereas the counter has zoomed over 85% in the last one year.

Shoppers Stop share price ended the day up by 20% on the BSE.

Speaking of the current stock market scenario, note that the BSE smallcap index has surged around 180% since the crash in March 2020.

Despite the index being up more than 1.8 times, Richa Agarwal, lead Smallcap Analyst at Equitymaster, believes smallcap stocks are set for a massive up move in 2021 and beyond.

Here's why...

The Smallcap to Sensex ratio, a metric referred to get a sense of relative valuations, currently stands at 0.48 times. To be sure, this is higher than a median of 0.43 times.

And yet, it's the lowest of all the peaks in the small caps so far. In the last cycle which peaked in January 2018, when the ratio touched 0.49, the peak was still 9 months away.