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Wall Street closed sharply lower in the previous session,
pressured by a jump in Treasury yields and concerns about the
rising geopolitical tensions between Iran and Israel.
The yield on the 10-year government bond last stood at 4.6468%,
a day after data showed U.S. retail sales increased more than
expected in March amid a surge in receipts at online retailers.
This was further evidence that the economy had ended the first
quarter on solid ground.
Meanwhile, Israelis awaited word on how Prime Minister Benjamin
Netanyahu would respond to Iran's first-ever direct attack, as
international pressure for restraint grew over fears the
conflict could escalate.
Several policymakers including Federal Reserve Chair Jerome
Powell are slated to speak later in the day, and investors will
be watching for clues on where the central bank stands on policy
easing.
San Francisco Fed President Mary Daly said on Monday that with
the economy and labor market strong and inflation still above
the Fed's 2% target, there was "no urgency" to cut U.S. interest
rates.
Traders see an about 48% chance of the Fed kicking off its
easing cycle in July, according to the CME FedWatch tool.
On the earnings front, financial firms will be in the spotlight,
with Bank of America, Morgan Stanley and BNY Mellon scheduled to
report their quarterly numbers before the opening bell.
Drugmaker Johnson & Johnson is also due to report before markets
open.
U.S. equities have sold off recently as investors sharply
readjusted their expectations of how much the Fed would cut
rates this year, with bets now showing only 43 basis points of
expected easing, according to LSEG data. This is down from about
150 bps seen at the start of the year.
At 5:38 a.m. ET, Dow e-minis were down 72 points, or 0.19%, S&P
500 e-minis were down 8.75 points, or 0.17%, and Nasdaq 100
e-minis were down 20.75 points, or 0.12%.
Tesla shed 2.1% in premarket trading after falling over 5% in
the last session, when an internal memo seen by Reuters showed
the EV marker was laying off more than 10% of its global
workforce.
(Reporting by Shashwat Chauhan in Bengaluru; Editing by Pooja
Desai)
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