The Dow Futures jumped 200 points in night trade after the worst take route since March

The “Fearless Girl” statue stands in front of the New York Stock Exchange (NYSE) on June 29, 2020 in Wall Street in New York City.

Angela Weiss | AFP | Getty Images

Stock futures climbed into overnight trading on Monday after experiencing the worst selling by technology stocks in more than five months.

Futures were up nearly 220 points on the Dow Jones Industrial Average, while S&P 500 futures gained 0.5%. The Nasdaq 100 futures were flat.

Stocks pulled off a five-week winning streak after major upsurge in key technology stocks last week. Heavy losses at Amazon, Apple, Microsoft and Facebook – the market leaders of 2020 – saw the tech-heavy Nasdaq Composite down 3.3% to suffer its worst week since March 20. The Dow and the S&P 500 fell 1.8% and 2.3% respectively last week. , Is posting its biggest weekly deficit since June.

Many in Wall Street believe the weakness created by the concerns led to large-scale tech run-up valuations to volatile levels. Aggressive buying of growth stocks is also spreading in option markets. Even with last week’s return, the Nasdaq is more than 70% below its March lows.

In a note, Matt Maley, chief market strategist at Miller Tabak, said, “Given how extreme the indicators we followed had started in the past one week, we believe it would be helpful to work under those conditions.” There will be more than a slight drop. ” on Sunday. “We therefore believe that an improvement of more than 10% is likely.”

Male also pointed to some of the megacap tech names, as well as excessive overbought conditions at elevated valuation levels for the S&P 500.

Last week’s Big Tech recession coincided with an outperformance in cyclical stocks – the most sensitive name for economic recovery. The S&P 500 material and financial sector were the two biggest winners in the first week, 2.3% and 0.9% respectively.

The Cboe Volatility Index, known as the VIX or “fear gauge” of the market, amid high rotation, hit a high of 38.28 on Friday, its highest level since June 15.

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