US Stocks Seen Lower on Global Sell-Off

U.S. stock index futures signaled a lower open on Monday, as last week's global sell-off, which started when the Federal Reserve signaled it could end its asset purchases this year, continued.

Concerns about tightening central bank policy were reignited on Monday when the People's Bank of China refrained from pumping cash in to the economy, despite a liquidity squeeze. The news accelerating losses on the Shanghai Composite (.SSEC), which closed at a fresh 2013 low.

However, Capital Economics' John Higgins forecast there could be "some respite" from the global sell-off, which saw the S&P 500 (.SPX) close 2.1 percent down on last week, and the Dow (.DJI) close 1.8 percent lower.

"Although the ride may remain bumpy, we would not be surprised if there was some respite given the scale of the recent sell-off. For one thing, a near-term tapering of the third round of quantitative easing is now probably fully discounted and the Fed is likely to tread extremely carefully in any case in withdrawing its stimulus. Some countries should also actually benefit from the stronger U.S. growth that will presumably be the context in which the Fed decides to tighten the screws," said Higgins, in a research note out late on Friday.

Furthermore, the Bank for International Settlements (BIS) waved a red flag for central banks over the weekend, saying it was time to end ultra-lose monetary policy. BIS, known as the central bank for central banks, said in its annual report that current monetary policy in the U.S., euro zone, U.K. and Japan will not bring about much-needed labor and product market reforms, and is a recipe for failure.

Meanwhile, Goldman Sachs became the latest bank to downgrade China's growth outlook on Monday, saying tighter financial conditions are a downside risk for the world's second largest economy. The bank cut China's gross domestic product growth forecast for the second quarter to 7.5 percent on the year, down from 7.8 percent.

Monday will be a quiet day for both U.S. earnings and macroeconomic news. Dallas Federal Reserve President Richard Fisher, a voting member of the Federal Open Market Committee next year, will give a speech on U.S. monetary policy.

In stock-specific news, Vodafone (VOD-GB) agreed to buy Germany's largest cable operator Kabel Deutschland (KD8-DE) for 7.7 billion euros ($10 billion) on Monday, trumping an offer from John Malone's Liberty Global (LBTYA).

Plus, Citigroup (C) is expected to announce on Monday that it will open an office in Baghdad, becoming the first U.S. bank to move into Iraq.

Apple stocks (APPL) may be closely watched, as the technology giant announced late on Friday that it had changed the way senior executives, including CEO Tim Cook, will receive stock awards. From now on, the award size will depend on stock market performance.

Meanwhile, U.S. crude oil prices could fall further this week, having sunk 3 percent last Thursday after Fed Chairman Ben Bernanke's news conference. A majority of analysts in a CNBC poll forecast prices would ease further this week.

By CNBC's Katy Barnato