The S&P 500 faced downward pressure as investors digested dovish remarks from Federal Reserve Governor Christopher Waller, who hinted at potential rate cuts in the first half of 2025, contingent on favorable inflation data. This uncertainty over future monetary policy has led to a cautious stance in equity markets, with investors contemplating the broader economic implications of such rate adjustments. Concurrently, bond prices have risen, driven by the allure of potentially lower future interest rates. The market's reaction is further complicated by a strong dollar, supported by Treasury Secretary nominee Scott Bessent's commitment to its global reserve currency status, and rising import prices, which have heightened inflationary concerns.
The Direxion Daily S&P 500 Bull 3X Shares (SPXL) saw a decline, closing at $172.30 and currently trading at $171.42, down 1.00% from its previous close of $173.15 as of 16:20 on Thursday, January 16.