The major averages took steep losses to start the week as investors continued their rotation out of technology stocks amid rising bond yields.

The S&P 500 shed 1.3% to 4,300.46. 

The market rebound followed a rough September plagued by fears of inflation, Federal Reserve tapering and rising interest rates. The S&P 500 finished the month down 4.8%, breaking a seven-month winning streak. 

The fourth quarter is typically a good period for stocks, but overhangs like central bank tightening, the debt ceiling, Chinese developer Evergrande and Covid-19 could keep investors cautious. Heading into the fourth quarter, more than half of all S&P stocks are off at least 10%.

The S&P 500 has averaged gains of 3.9% in the fourth quarter and was up four out of every five years since World War II, according to CFRA.

One of the first hurdles markets face in the new quarter is Friday’s closely watched employment report, which could spur the Federal Reserve’s decision on when to taper its bond-buying program.

Stock futures were muted in overnight trading on Monday following a tech-led sell-off as investors continued to dump high-flying shares in the face of rising rates.

On Monday, the Nasdaq Composite dropped 2.1% for its sixth negative day in seven as tech heavyweights Apple, Alphabet, Amazon and Microsoft all fell at least 2%. Shares of Facebook slipped 4.9%.

The 10-year Treasury yield was slightly higher Monday, trading around 1.48%. The 10-year U.S. Treasury yield hit 1.56% last week, its highest point since June, with investors concerned about inflationary pressures and tighter monetary policy.

A recent jump in bond yields caused investors to flee highly valued tech stocks as higher rates make their future profits less attractive.

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Plan A : Remain buy as long as oil price trades firmly above 76.6. Targets are 77.9 and 80.0.

Plan B : Consider short only if oil price surges but fails to breach above 77.9. Targets are 77.4 and 76.6.