The Nuveen Core Equity Alpha Fund (JCE) is experiencing downward pressure due to several factors impacting its underlying assets. A significant contributor is the recent strength of the U.S. dollar, which has surged following the Federal Open Market Committee (FOMC) meeting on December 18, 2024. This appreciation in the dollar is affecting the revenue of S&P 500 companies, particularly those with substantial non-U.S. revenue streams. Approximately 45% of S&P 500 revenue is derived from international markets, and the technology sector, a major component of the index, is especially vulnerable with 55% of its revenue coming from abroad. The strong dollar is thus exerting a negative impact on revenue growth for these companies, contributing to the ETF's decline.
Additionally, market volatility has been exacerbated by the Federal Reserve's recent interest rate decisions. Despite a rate cut of 0.25 percentage points, the market was disappointed by the FOMC's projections, which indicated fewer rate cuts than anticipated for 2025. This has led to a sharp fall in U.S. stocks, further impacting the ETF. The broader market sentiment is also being influenced by concerns over potential tariffs and political uncertainties in Europe, which have dampened risk appetite and contributed to a muted performance in European equities.
The JCE ETF is down 5.49% in pre-market hours on Monday, December 23, falling to $14.64 as of 6:02 AM ET.