The S&P 500 faced a decline as investors processed dovish remarks from Federal Reserve Governor Christopher Waller, who suggested potential rate cuts in the first half of 2025 if inflation data remains favorable. This has introduced uncertainty into the market, prompting a reassessment of the economic outlook and leading to a downturn in equity markets. Concurrently, bond prices have risen, reflecting their increased appeal amid the prospect of lower future interest rates. The market is also navigating a strong dollar, supported by Treasury Secretary nominee Scott Bessent's commitment to maintaining its global reserve currency status, alongside rising import prices that signal ongoing inflationary pressures.
The ProShares Short S&P500 ETF (SH) saw a modest increase, rising 0.24% to $42.09 at 16:20 on Thursday, January 16.