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Share market expectations: 5 things you need to know before tomorrow's opening bell

Share market updates and analysis for July 22: Corporate earnings announcements, coronavirus vaccine hopes and global cues to set tone for stock markets

Chitranjan Kumar | July 21, 2020 | Updated 21:15 IST
Share market expectations: 5 things you need to know before tomorrow's opening bell
Stock market news: What to expect on July 22

The Indian benchmark equity indices - Sensex and Nifty - ended higher on Tuesday as hopes of COVID-19 vaccine and positive global cues boosted investors sentiment. Continuing its gaining streak for the fifth straight session, Sensex ended 511 points higher at 37,930 and Nifty closed 140 points higher at 11,162. On Monday, Sensex ended 99 points higher at 36,693 and NSE Nifty rose 47 points to settle at 10,815.

Among the index heavyweights, PowerGrid was the top gainer, rising over 6 per cent, followed by Maruti, Reliance Industries, ICICI Bank, HDFC, BPCL, Kotak Bank, Axis Bank, and HDFC Bank. On the flip side, Bajaj Finance, Bajaj Finserv, Asian Paints and Sun Pharma were among top losers.

On the sectoral front, all the indices, barring pharma and FMCG, ended in green on the NSE, with Nifty bank and realty index gaining over 2 per cent.

"Benchmark indices again showcased volatility but showcased positive momentum, in sync with global cues. EU leaders have finally reached an agreement on a massive stimulus plan to combat the pandemic impact. News about successful progression of COVID-19 vaccine trials also boosted the global markets while positive quarterly earnings results, especially from the leaders, provided an additional support to the Indian markets," said Vinod Nair, Head of Research at Geojit Financial Services.

Also Read: Sensex ends 511 points higher on COVID-19 vaccine hopes, banking stocks rally

"Although the market uptrend remains intact, investors are advised to be cautious since it seems to be in overvalued territory. Result-heavy day today, and stock specific commentary will be looked at," he added.

Here's what you need to know before share market opens on July 22.

Earnings announcement

Engineering and construction major Larsen & Toubro (L&T) and auto major Bajaj Auto along with other listed companies are scheduled to announce their earnings report on Wednesday. The June quarter earnings reports will provide a clear picture of the disruption caused by the coronavirus pandemic-induced lockdown.

Also Read: Coronavirus update: 7 Indian firms in race to find COVID-19 vaccine

Progress on COVID-19 vaccine

According to the latest update on the coronavirus vaccine, Russia has claimed that it is set to roll out its COVID-19 vaccine by next month. The Russian Defence Ministry, which is developing the inoculation, has successfully completed its Phase II human trials. In India, at least seven companies, including Bharat Biotech, Zydus Cadila, Indian Immunologicals, Nynvax, Panacea Biotec, and Biological E, are working on the COVID-19 vaccine. While Hyderabad-based Bharat Bharat Biotech has successfully begun human trials on its vaccine candidate Covaxin, Zydus Cadila has started clinical trials of its COVID-19 vaccine candidate, ZyCoV-D.

Globally, the World Health Organisation (WHO) is tracking around 140 vaccine candidates, of which around two dozens are in various phases of human trials. Vaccine candidates from Chinese company Sinovac Biotech and Oxford-AstraZeneca have entered into Phase-3 trial. Besides, the US-based Moderna is also expecting to start the Phase-3 trial of its vaccine candidate by the end of this month.

Coronavirus cases

COVID-19 cases are constantly rising in the country. India reported 37,148 fresh cases and 587 fatalities in the last 24 hours till 8 am on Tuesday, data released by the Health Ministry showed. With this, India's total tally surged to 11,55,191, including 4,02,529 active cases and 7,24,578 recoveries, and the death toll climbed to 28,084. Maharashtra continues to remain the worst-hit state with 3,18,695 cases of COVID-19, followed by Tamil Nadu and Delhi with  1,75,678 and 1,23,747 cases, respectively.

Also Read: Rossari Biotech IPO: How to check allotment status

Cues from global stocks

Globally, markets in the Unites States and Europe were trading higher on Tuesday. The European stocks were buoyed by the European Union's sanction of a 750 billion euro ($860 billion) fiscal stimulus deal to help support the virus-stricken region. The US stocks were also trading higher after earnings reports from major American companies provided fresh pictures of the disruption caused by the coronavirus pandemic on businesses and how they are coping with the crisis. The hopes for fresh fiscal stimulus by the US government also injected positivity in the market.

Stock specific movements

Shares of index heavyweights Axis Bank and Hindustan Unilever Limited (HUL) will remain in focus as these companies announced first quarter earnings after market hours on Tuesday.

FMCG major HUL has reported a 7.18 per cent year-on-year growth in standalone net profit at Rs 1,881 crore for June quarter, while total sales grew by 4.23 per cent YoY to Rs 10,406 crore.

Axis Bank reported a 19 per cent YoY decline in its net profit at Rs 1,112 crore for the first quarter ended June 30, 2020, dented by sharp decline in other income. The lender's net interest income (NII), however, rose 20 per cent YoY to Rs 6,985 crore during Q1FY21. On asset quality front, gross non-performing assets (NPAs) ratio as a percentage of gross advances declined to 4.72 per cent and the net NPA ratio fell to 1.23 per cent in Q1FY21.

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