The recent pause in the stock market rally can be attributed to geopolitical tensions, particularly the US's review of its Economic and Trade Agreement with China. This development has raised concerns about the stability of trade relations, especially impacting the technology sector, which is highly sensitive to such geopolitical shifts. President Donald Trump's mixed signals on economic policies, including potential tax cuts and a softer stance on tariffs, have further contributed to market uncertainty. In response, investors have shifted towards safer assets, leading to a rally in Treasury bonds and a decline in yields. The dollar has weakened, marking its worst week since November 2023, as lower Treasury yields have made US exports more competitive. Additionally, oil prices have seen their first weekly drop of the year, influenced by Trump's calls for OPEC to reduce prices.
The Direxion Daily S&P 500 Bull 3X Shares (SPXL) experienced a decline, closing at $185.99, down 0.98% from its previous close of $187.83.