As traders unwound bets on the Federal Reserve cutting interest rates this year, US tech stocks fell while government bonds rose.

The Nasdaq 100 fell for a second day on Monday, following its worst week since March. Profit-taking in the technology sector continued, with some of the year's hottest names, including AI darling Nvidia and Facebook-parent company Meta Platforms, falling. Tesla fell 6.1% after Goldman Sachs joined the list of brokers who are less optimistic about the electric vehicle maker following this year's blistering rally.

Traders are finally backing off their bets on the Fed cutting rates this year, after Fed Chair Jerome Powell warned last week that the US may need one or two more rate hikes in 2023. Investors are becoming increasingly concerned that central banks determined to eliminate inflation will continue to raise interest rates, putting fragile economies at risk.