To The Moon

Futures pointed to muted moves for U.S. stocks, while government bonds extended losses, as investors awaited inflation data and the start of earnings season.

Contracts for the Nasdaq-100 ticked up 0.1% Monday, signaling minor gains for the technology-focused index. The Nasdaq Composite Index last week posted its biggest one-week percentage decline since February 2021. as rising bond yields punctured tech valuations. Futures for the S&P 500 and the Dow Jones Industrial Average were flat Monday.

The yield on benchmark 10-year Treasury notes—which moves inversely to their price—rose to 1.795% from 1.769% Friday. Friday’s closing level was the highest since January 2020, when yields tumbled at the start of the pandemic.

Rising yields at the start of 2022 have sent a shudder through tech stocks. Pushing yields up are indications that the Federal Reserve could raise short-term interest rates in March and begin to shrink its holdings of bonds and other assets soon afterward.

Inflation data due Wednesday will be keenly watched as investors seek to predict when the Fed will begin to raise borrowing costs. Monthly consumer prices are expected to have risen more than 7% from a year earlier, for the first time since 1982.

Later this week, fourth-quarter earnings season kicks off at major U.S. financial firms, with JPMorgan Chase, Citigroup, Wells Fargo and BlackRock due to file results. Many investors are pushing money into bank stocks, figuring they stand to profit from a rise in interest rates.

Among them is Hani Redha, a multiasset fund manager at PineBridge Investments. He said the New York-based investment firm has cut its ownership of tech stocks and Treasurys while boosting cash holdings and exposure to financial companies.

“Equities are down and bonds are down too,” Mr. Redha said. “At least for a while, even cash is better than owning risk assets.”

In commodities, U.S. natural-gas prices rose 4.2% to $3.88 per million British thermal units. Cold weather in the Midwest and eastern U.S. early this week will likely boost demand for the fuel, according to analysts at NatGas Weather.

As back-to-back winter storms hit the U.S., the East Coast braced for more flight cancellations, school closures and traffic backups through the weekend. Photo: Deccio Serrano/Zuma Press

Overseas stock markets were mixed. The Stoxx Europe 600 slipped 0.2%, weighed down by shares of real estate and tech companies. Shares in Atos sank 17% after the French information-technology firm said 2021 results lagged expectations due to project delays and supply-chain challenges.

The Shanghai Composite Index added 0.4% and Hong Kong’s Hang Seng rose 1.1%. Japanese markets were closed for a public holiday.