Here are the key news, trends, and analysis investors need to start their trading day:
1. Nasdaq, S&P 500 will both fall for 5 sessions in a row
The Nasdaq logo will be displayed on the Nasdaq Market location in Times Square in New York City on December 3, 2021.
Jeenah moon | Reuters
US stock futures fell on Monday after a rough first week of trading in the New Year as technology stocks were battered by soaring bond yields. The Nasdaq posted a four-session losing streak on Friday, with the largest loss coming last Wednesday. For the week, the tech-heavy index fell 4.5% in its worst weekly performance since February 2021. Monday’s S&P 500 also had a five-session losing streak. The index was down 1.9% last week. The Dow Jones Industrial Average, which fell three sessions in a row, was down 0.3% last week. Both the Dow and S&P 500 hit record highs early last week.
2. Goldman Sachs increases Fed rate hike forecast to quadruple this year
Bond yields ticked higher on Monday, with the 10-year benchmark yield trading at 1.77% after hitting a 1.8% high on Friday through January 2020. Goldman Sachs expects the US Federal Reserve to hike rates from near zero four times this year as inflation rises and unemployment falls. In the minutes of its December meeting, the Fed revealed talks about a balance sheet cut in addition to signaled rate hikes and an accelerated rejuvenation. Fed chief Jerome Powell will testify at his nomination hearing in front of a Senate panel on Tuesday.
3rd week in advance: Powell’s hearing, inflation and revenue
In the coming week, consumer and wholesale inflation reports will be released on Wednesday and Thursday. Economists expect another hot month for both values, although some economists believe inflation is about to peak. November’s headline CPI of 6.8% was its highest since 1982. Retail sales will be released on Friday. Earning season also begins with Delta Air Lines quarterly results on Thursday and JPMorgan Chase, Citigroup and Wells Fargo on Friday.
4. Take-Two to buy Zynga, a mobile gamer whose shares have skyrocketed as a result of the deal
Signage at Zynga’s headquarters in San Francisco, Calif., USA on Wednesday, August 4th, 2021. Zynga Inc. is expected to release earnings results on August 5th.
David Paul Morris | Bloomberg | Getty Images
Take-Two Interactive announced Monday that it would buy mobile game maker Zynga in a cash-and-stock deal for an enterprise value of nearly $ 12.7 billion. Take-Two said it will purchase all of its outstanding Zynga shares at $ 9.86 per share, a 64% markup from Friday’s close of trading, which was largely reflected in Monday’s pre-trading session. The Take Two share lost around 10% in the pre-trading session. The deal is expected to be completed by the end of June.
5. Lululemon Says Fourth Quarter Results and Revenues Are Affected Due to Omicron
A look at the logo of a Canadian sportswear retailer Lululemon seen in one of its stores.
Alex Tai | LightRakete | Getty Images
Lululemon’s shares came under pressure after the retailer and apparel maker announced Monday morning that fiscal fourth quarter earnings and earnings are likely to be at the lower end of estimates. The company blames a shortage of staff and shortened shop opening times for the increase in Covid cases in the USA due to the Omicron variant. In pre-market trading, the share lost more than 7%.
– Reuters contributed to this report. Follow all market activity like a pro on CNBC Pro. Get the latest on the pandemic with coronavirus coverage from CNBC.