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Traders globally were treading with caution after an aborted
revolt by Russian mercenaries raised concerns over the stability
of President Vladimir Putin and a potential disruption to
Russian oil supply.
Shares of U.S. defense companies including Raytheon Technologies
and Lockheed Martin Corp slipped about 1% each in thin premarket
trading.
Oil stocks like Exxon Mobil and Chevron dipped as crude prices
reversed early gains spurred by the revolt. [O/R]
"Geopolitical events have caused markets to take a 'tread
carefully' approach to start the week," Tim Waterer, chief
market analyst at KCM Trade said in a note to clients.
"And while events in Russia over the weekend seem to have calmed
down again for the time being, it has had the effect of putting
safe-haven assets back on the radar."
A recent rally in U.S. stocks sputtered last week after Fed
Chair Jerome Powell's testimony in which he signaled more
interest rate hikes ahead but vowed the central bank would
proceed with caution.
Most policymakers see at least two more quarter-point rate
increases by the end of this year, while traders expect one more
rate hike in July and see the Fed holding rates steady through
the end of 2023, according to CMEGroup's Fedwatch tool.
The tech-heavy Nasdaq snapped its eight-week winning streak on
Friday, its longest since March 2019, while the benchmark S&P
500 broke its five-week rally, its longest since November 2021.
A slew of economic data including a key inflation gauge, durable
goods and University of Michigan's consumer sentiment index will
be released this week. Powell is also set to speak again later
this week.
At 5:39 a.m. ET, Dow e-minis were down 9 points, or 0.03%, S&P
500 e-minis were down 4.5 points, or 0.1%, and Nasdaq 100
e-minis were down 29.5 points, or 0.2%.
Alphabet Inc slipped 1.6% premarket after UBS downgraded the
stock to "neutral" from "buy", while Tesla Inc fell 2.1% after
Goldman Sachs cut the electric car maker's rating to "neutral".
Moderna Inc rose 3.1% after UBS upgraded the vaccine maker's
stock to "buy".
(Reporting by Sruthi Shankar in Bengaluru; Editing by Shinjini
Ganguli)
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