MORNING BID-Oil tumble reigns in equity rally

LONDON, April 28 - A look at the day ahead from emerging markets chief correspondent Karin Strohecker. The views expressed are her own.

The global stocks rally is losing steam in Europe after some Asian markets enjoyed the afterglow of healthy 1.5% overnight gains on Wall Street on news that some states could soon emerge from lockdown, though fresh oil woes are capping enthusiasm.

Crude prices have taken another plunge as storage capacity worldwide runs low and demand tumbles. U.S. crude futures dropped by another 20% after Monday's 25% tumble to trade at just over $10 per barrel. Brent crude fell to $19 per barrel before the contract expires later in the week.

The drop in crude kept safe-haven bids alive with German benchmark bond yields nudging lower.

Currency markets were little changed, apart from petro-currencies coming under pressure, with markets in wait-and-see mode before the U.S. Federal Reserve meets on Wednesday and the European Central Bank gathers on Thursday.

At its meeting today, Sweden's central bank said it would continue to purchase government and mortgage bonds up to the end of September. It left interest rates unchanged at zero.

Support from central banks has provided some momentum for stock markets around the globe, with the Bank of Japan on Monday promising an unlimited amount of bond buying and low interest rates. Asian markets were cautiously optimistic with Japan’s Topix and South Korea’s Kospi ending the day flat while China mainland blue chips gained 0.8%.

In Europe, Frankfurt, Paris and London markets were treading water at the open as the earnings season continued. The spotlight was on banks, some of the big losers in the crisis so far. Warnings that the incoming coronavirus-triggered recession will be ugly came from Spain's Santander and Britain's HSBC, both of which boosted provisions against bad loans and recorded a sharp fall in profits.

But the world's largest wealth manager, UBS, had some good news to report with a 40% increase in first-quarter net profit as clients increased trading activity during the market turmoil.

Oil major BP reported a net income tumbled by two-thirds as the coronavirus pandemic hit oil demand. There a lot at stake for investors as Shell and BP represent an estimated 24% of the £75 billion of FTSE 100 dividends for 2019 not yet hit by the market turmoil. Engineering firm ABB said it expected the coronavirus epidemic to trigger a "sharp drop" in demand over the next three months and Norway's Telenor warned that 2020 revenue and earnings will fall short of its outlook.

Travis Perkins, Britain's largest distributor of building materials, said its total revenue in the first three weeks of April was about a third of the same period in 2019 due to the coronavirus crisis.

The assumption that pharmaceuticals are one of the safest bets in times like these seemed to be confirmed by the Swiss drug maker Novartis, which beat expectations and reaffirmed its 2020 targets as the pandemic prompted patients to stock up on prescriptions in advance. Another winner is German online takeaway food company Delivery Hero, whose orders and revenues almost doubled as lockdowns closed restaurants and prompted more people to order meals and groceries from home. Meanwhile, Rovio Entertainment, the maker of the 10-year-old "Angry Birds" mobile game series, said it saw an increase in the number of downloads as well as user engagement.

U.S. futures point to an equally lacklustre start on Wall Street later in the day.

In European fixed income, Italian yields continued to ease and hold near the weekly lows hit on Monday, after S&P kept the coronavirus-hit country’s credit rating steady at BBB/A-2 late last Friday.

(Reporting by Karin Strohecker, editing by Larry King)