US stock index futures point to a lower opening pressured by drop in oil prices

U.S. stock index futures pointed to a lower opening on Monday, pressured by a drop in oil prices and muted appetite for equities after last week's spike in Treasury yields following healthy economic data.

Yields on the 10-year note were at seven-year highs after a solid jobs report raised the spectre of faster interest rate hikes. The U.S. Treasury market is closed on Monday for the Columbus Day holiday.

"There's a hangover from last week's rapid move in yields and just because the bond market's closed, doesn't mean investors are not worried," said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee.

Exxon Mobil and Chevron dropped 0.9 per cent each in premarket trading and were top decliners among the Dow Industrials as oil prices weakened.

Crude prices dropped below $83 per barrel on expectations that some Iranian oil exports will keep flowing after the United States reimposes sanctions, easing a strain on supplies.

While U.S. stocks have eased off record high levels following last week's drop, there are still concerns about valuations in the pricier names, especially with the corporate earnings season on tap.

"This earnings season, investors will be looking at whether margins have been hurt by higher inflation, wages and also a commentary on trade," Antonelli said.

The so-called FAANG group – Facebook, Amazon, Apple, Netflix and Alphabet – had led the market lower on Friday and their shares were down between 0.04 per cent and 1.12 per cent.

At 8:42 a.m. ET, Dow e-minis was down 104 points, or 0.39 per cent. S&P 500 e-minis was down 6.75 points, or 0.23 per cent and Nasdaq 100 e-minis were down 21.25 points, or 0.29 per cent.

Casino operators fell after Morgan Stanley cut its gross gaming revenue growth estimates for Macau.

Wynn Resorts and Las Vegas Sands were down 1.6 per cent each, MGM Resorts off 1.4 per cent and Melco Resort declined 1.6 per cent.

General Electric was set to extend a five-day rally, climbing 2.4 per cent after Barclays echoed investor optimism over Larry Culp, saying the conglomerate's new chief executive officer will be able to drive more robust restructuring.