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Chinese and European stock markets fell, while oil slid as data showed China’s economic activity cooled sharply in April as widening COVID-19 lockdowns took a heavy toll on consumption, industrial production and employment.
Wall Street closed sharply higher on Friday, but still the S&P 500 and the Nasdaq posted their longest weekly losing streaks in over a decade.
Investors have been worried that aggressive interest rate hikes by the Federal Reserve to combat decades-high inflation could hurt the U.S, economy, with the conflict in Ukraine, supply chain snarls and the latest pandemic-related lockdowns in China further exacerbating the situation.
Goldman Sachs (NYSE:GS) economists cut their forecast for U.S. GDP growth to 2.4% in 2022 from 2.6% previously, citing tighter financial conditions.
The S&P 500 and the tech-heavy Nasdaq have fallen 15.6% and 24.5%, respectively, so far this year, with growth stocks taking a sharp hit on concerns that bigger interest rate hikes could hurt their future cash flows.
Traders are now pricing a near 82% chance of a 50 basis point hike by the Fed in June. [IRPR]
Barring Tesla (NASDAQ:TSLA) Inc, other megacap growth companies such as Microsoft Corp (NASDAQ:MSFT), Google (NASDAQ:GOOGL) owner-Alphabet Inc, Amazon.com (NASDAQ:AMZN), Apple Inc (NASDAQ:AAPL) and Meta Platforms slipped about 0.3% in premarket trading.
Big banks were mixed, with Bank of America (NYSE:BAC) down 0.2%.
At 07:21 a.m. ET, Dow e-minis were down 28 points, or 0.09%, S&P 500 e-minis were down 11 points, or 0.27%, and Nasdaq 100 e-minis were down 51.75 points, or 0.42%.
After worrying inflation and consumer sentiment data last week, focus is now on the retail sales report due on Tuesday.
Retailers such as Walmart (NYSE:WMT) Inc, Home Depot (NYSE:HD) and Target Corp (NYSE:TGT) are also due to report their quarterly results this week.
Spirit Airlines (NYSE:SAVE) jumped 17.1% after JetBlue Airways (NASDAQ:JBLU) launched a hostile all-cash takeover bid for the discount carrier. JetBlue shares slipped 1%.