The S&P 500 is experiencing a selloff today, driven by pressure on technology stocks, particularly in the semiconductor sector, due to their reliance on AI-driven demand. This sector-specific downturn is compounded by expectations of fewer Federal Reserve rate cuts, which traditionally impact growth sectors like technology. Despite the decline, the selloff appears relatively contained, with less than 40% of the index's constituents in the red, suggesting that the downturn may be short-lived. The limited breadth of the decline indicates that investor sentiment remains stable, with no immediate signs of broader macroeconomic contagion. This stability could prompt a rotation out of tech stocks as investors reassess their positions.
The ProShares UltraPro S&P 500 (UPRO) ETF experienced a significant decline, dropping 5.53% to $92.43 at 12:00 PM on Monday, January 27.