Federal Reserve Chair Jerome Powell's recent comments on trade risks and economic projections have cast a shadow over investor sentiment, despite the Fed's anticipated rate cut. The market's cautious reaction reflects concerns about potential policy changes, including tariffs, which could introduce volatility as companies face cost increases and competitive pressures. The S&P 500 Index, which has been under pressure, saw a decline as small-cap stocks, sensitive to interest rates, dropped significantly. The recent rally led by major tech stocks is also experiencing a natural pullback, adding to the market's subdued mood.
The ProShares UltraPro S&P 500 (UPRO) ETF experienced a sharp decline, falling 7.22% to $90.34 by 4:00 PM on Wednesday, December 18.