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10 things you need to know before the opening bell on May 19

Updated : 2020-05-19 08:07:42

The Indian market is likely to open positive tracking global markets as investors in Asia and US cheered over the potential coronavirus vaccine from Moderna's trial. At 8:05 am, the SGX Nifty traded 157.5 points higher at 8,985, indicating a positive start for the Sensex and Nifty50.

1. Asia: Stocks in Asia jumped in Tuesday morning trade as hopes rise on a potential coronavirus vaccine after a positive development from a Moderna trial. In Japan, the Nikkei 225 surged 2.44 percent in early trade as shares of robot maker Fanuc soared nearly 4 percent. The Topix index also gained 2.07 percent. South Korea’s Kospi also saw robust gains as it added 2.04 percent. Over in Australia, the S&P/ASX 200 advanced 1.56 percent. Overall, the MSCI Asia ex-Japan index traded 0.77 percent higher. Investors watched for market reaction to overnight developments after Moderna reported “positive” phase one results for a potential coronavirus vaccine. The company said that after two doses all 45 trial participants had developed coronavirus antibodies. (Image Source: Reuters)
1. Asia: Stocks in Asia jumped in Tuesday morning trade as hopes rise on a potential coronavirus vaccine after a positive development from a Moderna trial. In Japan, the Nikkei 225 surged 2.44 percent in early trade as shares of robot maker Fanuc soared nearly 4 percent. The Topix index also gained 2.07 percent. South Korea’s Kospi also saw robust gains as it added 2.04 percent. Over in Australia, the S&P/ASX 200 advanced 1.56 percent. Overall, the MSCI Asia ex-Japan index traded 0.77 percent higher. Investors watched for market reaction to overnight developments after Moderna reported “positive” phase one results for a potential coronavirus vaccine. The company said that after two doses all 45 trial participants had developed coronavirus antibodies. (Image Source: Reuters)
2. US: Stock futures held steady in overnight trading on Monday after the market scored its best day in six weeks on rising optimism about a coronavirus vaccine. Futures on the Dow Jones Industrial Average rose about 20 points, while the S&P 500 futures were flat. The Nasdaq 100 futures were also little changed. The overnight action followed a strong rally on Wall Street that saw the Dow and S&P 500 both enjoying their biggest one-day gains since April 6. The 30-stock Dow jumped more than 900 points, while the S&P 500 closed the day up 3.2 percent, hitting its highest level since March 6. (Image Source: Reuters)
2. US: Stock futures held steady in overnight trading on Monday after the market scored its best day in six weeks on rising optimism about a coronavirus vaccine. Futures on the Dow Jones Industrial Average rose about 20 points, while the S&P 500 futures were flat. The Nasdaq 100 futures were also little changed. The overnight action followed a strong rally on Wall Street that saw the Dow and S&P 500 both enjoying their biggest one-day gains since April 6. The 30-stock Dow jumped more than 900 points, while the S&P 500 closed the day up 3.2 percent, hitting its highest level since March 6. (Image Source: Reuters)
3. Market At Close On Monday: Indian shares tumbled over 3 percent on Monday, with banks leading the fall, as investors were disappointed by government measures to aid an economic recovery. Sentiment was also affected after the government extended the lockdown till May 31 as domestic cases of the novel coronavirus continued to rise steadily. The Sensex ended 1,069 points lower at 30,029, while the Nifty lost 314 points to settle at 8,823. (Image Source: Reuters)
3. Market At Close On Monday: Indian shares tumbled over 3 percent on Monday, with banks leading the fall, as investors were disappointed by government measures to aid an economic recovery. Sentiment was also affected after the government extended the lockdown till May 31 as domestic cases of the novel coronavirus continued to rise steadily. The Sensex ended 1,069 points lower at 30,029, while the Nifty lost 314 points to settle at 8,823. (Image Source: Reuters)
4. Crude Oil: West Texas Intermediate for June delivery jumped more than 8 percent on Monday, one day ahead of the contract’s expiration, as production cuts and the easing of stay-at-home restrictions supported prices. The contract did close below its highest levels of the day, however, after earlier gaining more than 13 percent. WTI, the U.S. benchmark, rose $2.39, or 8.12 percent, to settle at $31.82 per barrel. Earlier in the session it traded as high as $33.32 per barrel. International benchmark Brent crude, which has already rolled to the July contract, settled 7.11 percent higher at $34.81. (Image Source: Reuters)
4. Crude Oil: West Texas Intermediate for June delivery jumped more than 8 percent on Monday, one day ahead of the contract’s expiration, as production cuts and the easing of stay-at-home restrictions supported prices. The contract did close below its highest levels of the day, however, after earlier gaining more than 13 percent. WTI, the U.S. benchmark, rose $2.39, or 8.12 percent, to settle at $31.82 per barrel. Earlier in the session it traded as high as $33.32 per barrel. International benchmark Brent crude, which has already rolled to the July contract, settled 7.11 percent higher at $34.81. (Image Source: Reuters)
5. Rupee Close: The rupee plummeted by 33 paise to close at 75.91 against the US dollar on Monday, tracking weak domestic equities and foreign fund outflows. Forex traders said rising crude oil prices and concerns about the effectiveness of the fiscal stimulus package weighed on investor sentiment. The local unit opened sharply lower at 75.85, then lost further ground to finally settle at 75.91 against the US dollar, down 33 paise over its previous close. It had settled at 75.58 against the US dollar on Friday. (Image Source: Reuters)
5. Rupee Close: The rupee plummeted by 33 paise to close at 75.91 against the US dollar on Monday, tracking weak domestic equities and foreign fund outflows. Forex traders said rising crude oil prices and concerns about the effectiveness of the fiscal stimulus package weighed on investor sentiment. The local unit opened sharply lower at 75.85, then lost further ground to finally settle at 75.91 against the US dollar, down 33 paise over its previous close. It had settled at 75.58 against the US dollar on Friday. (Image Source: Reuters)
6. MHA Order Seeking Compulsory Wages Payment Stands Overridden: The Ministry of Home Affairs (MHA) has ceased its order dated March 29, 2020 where it mandated the payment of wages to employees during the lockdown. The MHA has ceased all its previous orders on payment of wages to staff even of those units that were shut during the lockdown. The Supreme Court on May 15 had ordered no coercive action be taken against employers for non-payment of wages during the lockdown.  (Image Source: Reuters)
6. MHA Order Seeking Compulsory Wages Payment Stands Overridden: The Ministry of Home Affairs (MHA) has ceased its order dated March 29, 2020 where it mandated the payment of wages to employees during the lockdown. The MHA has ceased all its previous orders on payment of wages to staff even of those units that were shut during the lockdown. The Supreme Court on May 15 had ordered no coercive action be taken against employers for non-payment of wages during the lockdown.  (Image Source: Reuters)
7. No Plan To Cut Government Spending, Says TV Somanathan: Expenditure secretary TV Somanathan on Monday said this is a challenging year for the central government due to the serious revenue impact of the coronavirus crisis, but added that the Centre had no plan of carrying out poorly calibrated expenditure cuts. “One of the problems with trying to estimate the cash outflow on the package is that we have given a large number of very substantial guarantee commitments, which are not completely without fiscal costs.
7. No Plan To Cut Government Spending, Says TV Somanathan: Expenditure secretary TV Somanathan on Monday said this is a challenging year for the central government due to the serious revenue impact of the coronavirus crisis, but added that the Centre had no plan of carrying out poorly calibrated expenditure cuts. “One of the problems with trying to estimate the cash outflow on the package is that we have given a large number of very substantial guarantee commitments, which are not completely without fiscal costs." There is a fiscal outgo on guarantees and many of the estimates miss that aspect, he added. (Image Source: Reuters)
8. US President Trump Is Taking Hydroxychloroquine Despite FDA Warning: US  President Donald Trump, in a surprise announcement, said on Monday he is taking hydroxychloroquine as a preventive medicine against the coronavirus despite medical warnings about the use of the malaria drug. During the press conference,
8. US President Trump Is Taking Hydroxychloroquine Despite FDA Warning: US  President Donald Trump, in a surprise announcement, said on Monday he is taking hydroxychloroquine as a preventive medicine against the coronavirus despite medical warnings about the use of the malaria drug. During the press conference, "I'm taking hydroxychloroquine," Trump said. "I've been taking it for the last week and a half. A pill every day." Weeks ago, Trump had promoted the drug as a potential treatment based on a positive report about its use against the virus, but subsequent studies found that it was not helpful. The Food and Drug Administration has issued a warning about its use. (Image Source: Reuters)
9. Analysts On GDP: The government's reform moves and stimulus package will only help the deeply-impacted growth process in the medium term of over three years and will not push up the GDP in the short term, analysts at two foreign brokerages said on Monday. The analysts at Bank of America (BofA) and Nomura maintained their earlier GDP estimates suggesting a contraction of 0.1 percent and 5 percent, respectively, for FY21 even after the announcement of the Rs 20 lakh crore economic package. The package may fall short of mitigating the near-term challenges for some businesses, but it is better designed to improve India's medium-term growth potential and attract long-term risk capital, analysts at the Japanese brokerage Nomura said. (Representational Image)
9. Analysts On GDP: The government's reform moves and stimulus package will only help the deeply-impacted growth process in the medium term of over three years and will not push up the GDP in the short term, analysts at two foreign brokerages said on Monday. The analysts at Bank of America (BofA) and Nomura maintained their earlier GDP estimates suggesting a contraction of 0.1 percent and 5 percent, respectively, for FY21 even after the announcement of the Rs 20 lakh crore economic package. The package may fall short of mitigating the near-term challenges for some businesses, but it is better designed to improve India's medium-term growth potential and attract long-term risk capital, analysts at the Japanese brokerage Nomura said. (Representational Image)
10. DBS Report On Fiscal Deficit Of Centre And States: The combined fiscal deficit of the Centre and states will top 12 percent of the GDP because of the recent economy boosting measures, and higher borrowings by states to meet COVID-19 exigencies, says a report. According to the report by DBS Bank, the combined fiscal gap will increase by 480 basis point (bps). In the case of the Centre, the fiscal gap will increase by 200 bps as earlier this month it hiked market borrowings by a whopping Rs 4.2 lakh crore or 54 percent over the budget estimate to Rs 12 lakh crore, citing the pandemic. Another 80 bps increase will be on account of the fiscal boost. In the case of states, the fiscal gap will rise by 200 bps after the Centre hiked the borrowing limit of states to 5 percent of GDP on Sunday. (Image Source: Reuters)
10. DBS Report On Fiscal Deficit Of Centre And States: The combined fiscal deficit of the Centre and states will top 12 percent of the GDP because of the recent economy boosting measures, and higher borrowings by states to meet COVID-19 exigencies, says a report. According to the report by DBS Bank, the combined fiscal gap will increase by 480 basis point (bps). In the case of the Centre, the fiscal gap will increase by 200 bps as earlier this month it hiked market borrowings by a whopping Rs 4.2 lakh crore or 54 percent over the budget estimate to Rs 12 lakh crore, citing the pandemic. Another 80 bps increase will be on account of the fiscal boost. In the case of states, the fiscal gap will rise by 200 bps after the Centre hiked the borrowing limit of states to 5 percent of GDP on Sunday. (Image Source: Reuters)
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