Big Tech is set to report first-quarter earnings this week.

Global stocks tumbled Monday after last week’s ugly close on Wall Street, when the Dow lost almost 1,000 points.
Concerns over strict new COVID-19 measures in Beijing drove Asian equities and oil prices lower.
Investors are nervous about the possibility of disappointing Big Tech earnings results this week.

US futures tumbled Monday alongside sharp falls for stocks around the world, as investors fretted about risks to economic growth from more-aggressive central bank policy and China extended lockdowns to Beijing.

Futures on the Dow Jones were down almost 1%, or 333 points, as of 5:20 a.m. ET, and S&P 500 futures fell 1%. Meanwhile, Nasdaq futures dropped 0.9%, suggesting a lower start to trading later in the day. The S&P 500 is down nearly 6% since the end of March.

The indicated declines follows a slide in US equities Friday, when the Dow notched its worst day since October 2020 to drop 981 points. Investors are worried the Federal Reserve’s pace of interest-rate rises could tip the economy into a recession, after its Chair Jerome Powell said a 50-basis-point hike is on the table at its May 3-4 meeting.

“His remarks led markets to further scale up the likely pace of Fed tightening, leaving futures priced for an almost 100% chance of 50-basis-point rate hikes at the next three meetings in May, June, and July,” UBS strategists said in a Monday note.

Expectations for the fed fund futures rate have risen from 2.47% to 2.83% in the last week, above the Fed’s estimate of neutral.

Policymakers at the European Central Bank, the Bank of England and elsewhere have echoed Powell in signaling more tightening may be needed to tackle inflation.

After some positive US earnings results last week, investors are nervous about the performance of mega-cap tech giants and the latest inflation reading on Friday. Big Tech names including Microsoft, Apple, Meta, Alphabet, Twitter, and Amazon are due to report quarterly earnings this week.

About 20% of S&P 500 companies have reported so far, with 80% beating forecasts, according to FactSet data. But Netflix shares lost one-third of their value after its high-profile earnings disappointment.

Sentiment toward stocks appears gloomy, as $15.21 billion flowed out of global equity funds in the week to April 20, Reuters reported. That’s the biggest weekly outflow since December 15.

The risk-off sentiment extended …read more

Source:: Business Insider

      

Dow futures fall 330 points, global stocks tumble as central banks’ hawkishness and Chinese lockdowns intensify worries about economic growth

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