Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., January 26, 2022.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., January 26, 2022. Reuters / BRENDAN MCDERMID

U.S. stocks were set to open lower on Friday after mixed earnings, while growth stocks cut some losses in a torrid week marked by surging bond yields as investors braced for higher interest rates.

In the previous session, Wall Street closed sharply lower after Federal Reserve Chair Jerome Powell backed moving more quickly to combat inflation and said a 50 basis point (bps) increase would be "on the table" when the Fed meets in May.

Powell's hawkish pivot triggered a selloff in megacap growth stocks such as Apple Inc and Inc, which were already reeling under the dismal results from streaming giant Netflix earlier this week.

The S&P 500 growth index is down about 16% since hitting a record high in late December, while its value counterpart is trading about 2% below its all-time time.

"If we see yields continuing to move higher, it's going to be a depressant on growth stocks," said Peter Cardillo, chief market economist at Spartan Capital Securities.

"The market is fearful of the Fed overchoking the inflation fear and causing a rut in corporate earnings in the future."

The prospect of a more hawkish Fed has led to a rocky start to the year for equities, in particular tech and growth shares whose valuations are more vulnerable to rising bond yields.

Google parent Alphabet, Inc and Meta Platforms Inc edged higher in premarket trading after suffering losses this week.

At 08:49 a.m. ET, Dow e-minis were down 117 points, or 0.34%, S&P 500 e-minis were down 11 points, or 0.25%, and Nasdaq 100 e-minis were down 5.25 points, or 0.04%.

Schlumberger NV gained 2.3% after reporting a higher first-quarter profit, as rising oil prices due to Russia's invasion of Ukraine boosted the demand for oilfield services and equipments.

Gap Inc tumbled 17.4% after the apparel company cut its forecast for quarterly sales, blaming execution challenges at its Old Navy brand and "macro-economic dynamics".

Verizon Communications Inc slipped over 2% after its full-year revenue forecast disappointed.

Of the 88 companies in the S&P 500 that have reported earnings for the first quarter, 80.7% of them have beat market expectations as of Thursday. Typically, 66% of companies beat estimates, according to Refinitiv data.

Investors are awaiting a flash reading on S&P Global composite PMI data for April after market opens.