Market Ahead, April 7: Top Factors That Could Guide Markets Today

To begin with, the markets were shut yesterday on account of Mahavir Jayanti and will remain shut on April 10 for Good Friday, making it a three-day trading week. According to analysts, investors are likely to track the trend in coronavirus cases and newsflow regarding it as well as the global cues for major trading decisions.

The number of coronavirus cases in India has reached 4,778. As many as 136 people have died of the disease so far and the country, according to Union health ministry, is somewhere between Stage 2 and 3 of the coronavirus pandemic. Globally, the death toll has surpassed 74,600. 

But, there are pockets of relief on the coronavirus front. 

On Sunday, New York reported virus-related deaths had fallen slightly from the previous day, although US officials have braced the country for a “peak death week” from the pandemic.

The fall in the daily death toll in New York fueled optimism among investors that a leveling off of the pandemic was on the horizon, thus sending the major US indexes at least 7 per cent higher. The Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite all recorded their biggest daily percentage rise since March 24.

Asian markets also looked poised on Tuesday to attempt another day of gains. Hong Kong futures were up and Australia futures also rose in early trade. Nikkei futures opened lower but were 2.3 per cent above the cash close. The SGX Nifty is up about 400 points from Friday's close. So, we might be in for a potential gap-up opening for the Indian indices today.

Now besides the global cues and coronavirus, investors will also react to Markit Services PMI data for March which was released yesterday, and, according to the monthly survey, India’s services sector contracted in March to 49.3 because overseas demand fell and exports received a hard knock, largely due to the coronavirus outbreak.

Besides these, any report on extension of the lockdown or an announcement of an industry-specific relief package will be a major trigger for the markets during the week.

Market participants will also track foreign fund flow, Rupee's trajectory, and oil price movement. Oil rose on Tuesday amid hopes that the world’s main oil producers including Saudi Arabia and Russia are likely to agree to cut output at a meeting on Thursday, although that would also depend on the United States doing its share, a Reuters report said.
Brent crude was up 2.2 per cent to $33.78 a barrel after falling more than 3 per cent on Monday. 

Read by: Kanishka Gupta