The Direxion Daily S&P 500 Bear 3X ETF (SPXS) is experiencing upward movement as investors react to a mix of economic data and market conditions. The October PCE inflation report, released on November 27, 2024, showed a rise in the core PCE price index by 0.3%, aligning with forecasts but still indicating persistent inflationary pressures. This has led to increased speculation about the Federal Reserve's next move, with markets pricing in a 66.5% chance of a rate cut in December. The uncertainty surrounding the Fed's decision is contributing to a cautious market sentiment, prompting some investors to hedge against potential downturns in the S&P 500.
Additionally, the broader market is showing signs of weakness, with the S&P 500 dipping 0.3% in early trading on November 27, 2024. This decline is partly driven by profit-taking in major technology stocks, including Nvidia and Meta Platforms, which have seen significant gains throughout the year. The information technology sector, in particular, has been under pressure, falling nearly 2% as companies like HP and Dell report disappointing earnings guidance. These factors are contributing to a risk-off environment, benefiting inverse ETFs like SPXS that are designed to profit from declines in the S&P 500.
The SPXS ETF rose to $5.95, marking a 1.19% increase as of 2:57 PM ET on November 27, 2024.