Market Ahead, April 30: All You Need To Know Before The Opening Bell

Traders go into the last day of this truncated trading week with many data points. The markets will remain closed tomorrow on account of Maharashtra day. Among factors, we have some good news on the Covid-19 treatment front, some heavyweight companies including Reliance Industries will announce their results today, and the government's announcement of some more relaxations post May 3. Moreover, the April derivative contracts expire today so that is expected to add further volatility to the session. 

But first let's look at the global cues. Big news is coming in from drugmaker Gilead Sciences which has announced that its drug remdesivir is showing promise as an effective COVID-19 treatment and is helping patients recover more quickly than standard care. The news prompted a broad rally on Wall Street overnight that sent the lead indices to the highest level since March 10.

The Dow Jones rose 2.2 per cent, the S&P 500 gained 2.66 per cent, and the Nasdaq Composite added 3.57 per cent. This despite the fact that the US economy suffered its sharpest decline in 11 years, with first-quarter GDP contracting at a 4.8 per cent.  More words of warning came from the US Fed which left key interest rates near zero at the conclusion of its two-day monetary policy meet. Chairman Jerome Powell warned the economy will drop at an "unprecedented rate" in the current quarter although he also said the economy will pick up as restrictions are lifted and vowed the central bank would continue to support the recovery.

Asian equity markets tracked Wall Street's rally in Thursday's early deals. Australian ASX 200 was up 1.3 per cent, while Japan’s Nikkei rose 2.5 per cent. SGX Nifty also gained more than 140 points, signalling a gap-up open for the Indian indices today.

In commodities, oil prices surged more than 10 per cent after US crude stockpiles grew less than expected. Brent crude futures settled at $22.54 a barrel, up 10.2 per cent.

Back home, the government announced amendments to its earlier guidelines to allow inter-state movements of people. The new lockdown guidelines will come into effect on May 4 and would give “considerable relaxations to many districts”. However, some are seeing these announcements as an indication that the nationwide lockdown could be extended beyond May 3 with some additional relaxations. Meanwhile, the total number cases of coronavirus cases in India has risen to over 33,000 and 1,079 people have died so far.

In terms of corporate results, some heavyweight names will announce their March quarter results today and their impact will be well beyond their individual stocks.

The oil and gas business of Reliance Industries is expected to take a steep hit with a sharp drop in gross refining margins although non-energy businesses like retail and telecom are expected to save the day.

IT major Tech Mahindra is also scheduled to announce its Q4 results today and investors will watch out for any update on the execution of large deals it won in the past four-five months, and a timeline of progress on its 5G rollout.

As for Hindustan Unilever, analysts say the company, like most consumer goods companies, would have taken a hit during the quarter under review due to Covid-19 lockdown, which has caused enormous logistical issues. As such, they see HUL's revenue declining anywhere from 2 per cent to 5 per cent during the quarter.

Read by: Kanishka Gupta