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(Bloomberg) — Before the trading day starts we bring you a digest of the key news and events that are likely to move markets. Today we look at:

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• Oil marketing companies
• Air cooling product makers
• Rally in steel shares

Good morning, this is Ashutosh Joshi, an equities reporter in Mumbai. Local equities look set for a fourth day of gains, tracking the buoyant trend in Asian markets this morning and the rally on Wall Street overnight. The Federal Reserve’s decision to slow the pace of balance sheet reduction and Chairman Jerome Powell’s comments on tariffs are expected to underpin sentiment. Meanwhile, global money managers are returning to India’s bond market.

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Lower oil prices may help fuel retailers absorb LPG hit

Shares of state-run fuel retailers have slumped this year amid worries that the government may not compensate them for selling LPG, or cooking gas, at below-cost prices. The burden is at 400 billion rupees ($4.6 billion) for the fiscal year ending March. However, the recent drop in oil prices has provided much-needed relief. According to Antique Stock Broking, the expansion in auto-fuel margins could help absorb the losses from discounted LPG. BPCL and IOC shares are up 4% and 7% this month, respectively, while HPCL has gained 1%.   

Air conditioner makers brace for scorching summer

Shares of air cooling product makers and their suppliers have been standout performers this month, driven by an early start to the summer and forecasts of an exceptionally hot season ahead. According to Nuvama analysts, companies are flooding distributors with their products, anticipating strong demand. Despite intense competition, most players have successfully passed on rising copper prices. Key beneficiaries include Voltas and Blue Star for the room air conditioning segment, while Havells and Crompton stand to gain from higher fan sales. Among suppliers, Nuvama is bullish on Amber and PG Electroplast.

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Steel stocks poised to extend recent gains

After a dismal start to the year, Indian steel producers are seeing brighter prospects following the country’s proposal to levy a 12% safeguard duty on all imports. The move is expected to further boost local prices, which have already risen over 5% since December. Analysts anticipate earnings upgrades for the sector, although valuations appear to be pricing in much of this optimism. The Nifty Metal Index is already trading one standard deviation above its historical valuation, at 14 times one-year forward earnings.   

Analysts actions:

• Bajaj Finserv Cut to Hold at Batlivala & Karani; PT 1,960 rupees
• Steel Authority Rated New Add at Emkay Global; PT 120 rupees
• Tata Comm Rated New Buy at JM Financial; PT 2,030 rupees

Three great reads from Bloomberg today:

• Years of Coal Backlash Undermine India’s Energy Security Push
• Powell Downplays Growing Risks, Sees Tariff Impact as Transitory
• Big Take: Trump Unleashes a New ‘China Shock’ on Rest of World

And, finally.. 

While foreign capital continues to exit Indian equities, it is pouring into rupee-denominated bonds. Global funds have bought $1.8 billion of rupee bonds so far this month — the highest since September — on bets of more rate cuts by the Reserve Bank of India. In contrast, they’ve sold over $2.6 billion of stocks amid concerns over slowing economic growth and high valuations. Indian bonds remain attractive due to their positive real yield, favorable carry over US Treasuries, and inclusion in major global indexes.

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—With assistance from Subhadip Sircar, Chiranjivi Chakraborty and Kartik Goyal.

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