Nasdaq futures slide 2% as higher yields pressure growth stocks By Reuters

(Reuters) – U.S. stock index futures slid on Monday as rising U.S. Treasury yields weighed on growth stocks amid prospects of aggressive policy tightening by the Federal Reserve, with fears of a sharp economic slowdown in China also dampening the sentiment.

Futures tracking the tumbled about 2%. Megacap stocks Microsoft Corp (NASDAQ:), Amazon.com (NASDAQ:), Apple Inc (NASDAQ:), Google-owner Alphabet (NASDAQ:) Inc, Meta Platforms and Tesla (NASDAQ:) Inc fell between 1.9% and 3.2% in premarket trading.

Yield on the benchmark 10-year Treasury note rose to 3.19%, its highest level since November 2018, as data last week underscored strength in the U.S. economy and investors bet on bigger rate hikes by the Fed to curb surging inflation. [US/]

Most traders expect the U.S. central bank to raise interest rates by 75 basis points at its June meeting, after increasing it by 50 basis points this month. [IRPR]

Technology-focused growth stocks have faced the brunt of the selloff this year, as their returns and valuations are discounted more deeply when yields rise.

The tech-heavy Nasdaq registered its lowest close since 2020 on Friday, notching a fifth straight weekly loss, its longest losing streak since the fourth quarter of 2012.

The S&P 500 growth index has dropped nearly 21% year-to-date, compared to a 13.5% fall in the benchmark .

Globally, stocks tumbled and oil prices fell on Monday, sparked by weak China data and a tightened COVID-19 lockdown in Shanghai that deepened investors’ fears that the global economy is headed for a slowdown. [GLOB/MKTS]

At 06:19 a.m. ET, were down 446 points, or 1.36%, were down 67.75 points, or 1.64%, and were down 251.75 points, or 1.98%.

Meanwhile, focus will be on U.S. inflation data and a slew of Fed speakers appearances this week as investors seek clues on the path of interest rates.

Morgan Stanley (NYSE:) fell 2.2% to lead declines among the big banks.