Technology stocks

Nasdaq Futures falls as tech stocks remain under pressure from higher bond yields

Bloomberg: U.S. stock index futures reported further losses on Monday as investors worried about monetary tightening and risks from China’s Covid-19 lockdowns, while tech stocks remained under pressure from the rising bond yields ahead of a big week for earnings.

S&P 500 index futures were down 0.7%, while Nasdaq 100 contracts fell 0.6% at 5:51 a.m. in New York, paring earlier declines of up to 1.2% . The Nasdaq 100 index has wiped out about $1 trillion in market value since Netflix Inc. posted disappointing results and the gauge edged closer to oversold levels.

U.S. stocks closed Friday at their lowest levels in more than a month as fears of a more aggressive Federal Reserve tightening cycle led to widespread selling. Investors are entering another busy week for big tech earnings, with Alphabet Inc., Microsoft Corp., Meta Platforms Inc., Paypal Inc. and Apple Inc. all reporting results.

Federal Reserve Chairman Jerome Powell’s endorsement on Friday of aggressive actions to rein in inflation prompted traders to rush to price interest rate hikes of half a percentage point during of the next four bank meetings, anticipating a sharp break with its decades-long practice of monetary tightening. policy at a gradual pace.

“Our view is that the market may now have priced in too much of the Fed’s tightening this year,” said Mark Haefele, chief investment officer at UBS Wealth Management. “A month ago the Fed’s dot chart showed a year-end fed funds rate of 1.9%, the market now expects that level to be reached in July and the funds feds end the year at 2.83%.

Shares of Twitter Inc. rose slightly in premarket trading after a report that Elon Musk met with the social media platform’s executives on Sunday as the company becomes more receptive to the $43 billion takeover offer of the billionaire.

In Europe, the Stoxx Europe 600 index fell 1.9% as the positive effects of Emmanuel Macron’s victory in the French presidential election were offset by macroeconomic fears. Mining and energy were the most depressed sectors, with commodities tumbling.

Global investors have also been spooked by fears of a wider foreclosure in Beijing amid the government’s unwavering adherence to its Covid-zero policy, while the deteriorating economic outlook due to Shanghai restrictions dent sentiment.

U.S.-listed Chinese stocks fell, with Pinduoduo Inc. leading a decline in U.S. certificates of deposit, down 4.1% in premarket trading. E-commerce peers Alibaba Group Holding Ltd. fell 3.5% and JD.com Inc. lost 2.5%. Electric car makers including Nio Inc. and Li Auto Inc. also fell. The weakness follows a 4.9% drop in China’s CSI 300 index, which closed at its lowest level in two years.