Federal Reserve Chair Jerome Powell's recent comments on trade risks and economic projections have cast a shadow over investor sentiment, leading to a cautious market reaction despite an anticipated rate cut. The Fed's decision, typically aimed at stimulating economic activity, has not provided the expected boost, as concerns about potential policy changes and tariffs under the Trump administration introduce uncertainty. This has particularly impacted small-cap stocks, which are more sensitive to interest rates, and has contributed to a broader pullback in the market, including a decline in the S&P 500 Index.
The SPDR Portfolio S&P 500 Growth ETF (SPYG) experienced a decline, falling 2.72% to $88.57 by 4:00 PM on Wednesday, December 18.