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The
benchmark 10-year Treasury yield hit 1.80% in early trading - a
level last seen in early 2020, having shot up 25 basis points
last week in its biggest move since late 2019.
Big banks like JPMorgan Chase & Co, Goldman Sachs, Bank of
America Corp, Morgan Stanley and Citigroup Inc gained between
0.3% and 0.8% in premarket trading.
Megacap growth companies including Apple Inc, Amazon.com Inc,
Microsoft Corp, Meta Platforms Inc and Tesla Inc fell between
0.2% and 1.1%.
Tesla led the declines with a 1.1% drop after Chief Executive
Officer Elon Musk tweeted on Friday that the electric carmaker
will raise the U.S. price of its advanced driver assistant
software.
Many technology and growth stocks tumbled in the first week of
2022 as investors began to recalibrate their portfolios to
account for a more hawkish Federal Reserve, while the banking
sector gained 9.4% last week as Treasury yields rallied on rate
hike expectations.
Investors await inflation data this week for cues on consumer
and producer prices, and whether it will sway the trajectory of
the U.S. central bank's interest rate hikes expected to begin
this year.
Markets are expecting a greater than 70% chance of an interest
rate rise to 0.25% in March and at least two more hikes by year
end. [FEDWATCH]
Goldman Sachs, on the other hand, expects the Fed to raise rates
four times in 2022, compared to its previous forecast of three.
At 6:53 a.m. ET, Dow e-minis were up 1 points, or 0%, S&P 500
e-minis were down 5 points, or 0.11%, and Nasdaq 100 e-minis
were down 49.75 points, or 0.32%.
Sportswear giant Nike fell 1.4% after HSBC downgraded the stock
to "hold" along with peer Adidas due to persistent supply chain
issues.
(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Maju
Samuel)
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