Investors are on edge as they anticipate increased volatility in the S&P 500, driven by the latest nonfarm payrolls report and rising bond yields. The options market is signaling a potential 1.2% move in either direction, highlighting the uncertainty surrounding economic conditions and the Federal Reserve's monetary policy. Persistent job growth and high inflation have led traders to speculate that the Fed might delay interest rate cuts, while rising bond yields continue to pressure stock prices by increasing discount rates. As the S&P 500 remains close to its peak, these factors create a challenging trading environment.
The Direxion Daily S&P 500 Bull 2X Shares (SPUU) experienced a decline, falling 0.92% to $148.04 at 10:40 AM on Wednesday, January 8.