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 remains under control. This has introduced uncertainty into the market, prompting a reassessment of the economic outlook and leading to a downturn in equities. Concurrently, bond prices have risen, driven by the allure of potentially lower future interest rates. The market is also navigating a strong dollar, supported by Treasury Secretary nominee Scott Bessent's commitment to its global reserve currency status, and rising import prices, which have increased inflationary pressures. These factors are contributing to the cautious sentiment among investors.
The SPDR Portfolio S&P 500 ETF (SPLG) closed at $69.60, down 0.17% from the previous close of $69.72, and further declined to $69.49, marking a 0.33% drop as of 16:20 on Thursday, January 16.