U.S. equity markets opened February 24 on a defensive footing, with broad-based declines across major indices as investors reassess risk exposure. The S&P 500 is down 1.04% to 6,837.75, while the Nasdaq has fallen 1.13% to 22,627.27, reflecting pressure on growth and technology names. The pullback comes amid elevated volatility and renewed concerns about macroeconomic headwinds.

Broad-Based Selling Across U.S. Indices

The Dow 30 has dropped 1.66% to 48,804.06, marking the steepest decline among large-cap benchmarks. Small-cap stocks are also underperforming, with the Russell 2000 sliding 1.61% to 2,620.99. Such synchronized weakness suggests a shift toward defensive positioning rather than isolated sector rotation.

The S&P 500’s 1.04% decline reflects pressure across multiple sectors, including technology, industrials, and consumer discretionary. Meanwhile, the Nasdaq’s 1.13% retreat highlights ongoing sensitivity in high-growth stocks, particularly those with elevated valuations tied to AI and digital transformation themes.

In contrast, Brazil’s IBOVESPA has risen 0.77% to 190,298.55, signaling relative strength in certain emerging markets. The divergence suggests global capital flows may be rotating toward regions perceived as offering valuation support or commodity-linked resilience.

Volatility and Dollar Strength Signal Caution

The VIX stands at 21.08, up modestly by 0.33%, but remaining above the key 20 threshold often associated with heightened uncertainty. Elevated volatility levels typically indicate increased hedging activity and reduced investor risk appetite.

At the same time, the U.S. Dollar Index has gained 0.24% to 97.94. A stronger dollar can pressure multinational corporate earnings and weigh on commodity prices, potentially amplifying equity market weakness. Dollar strength often coincides with capital inflows into perceived safe-haven assets during risk-off sessions.

Currency movements are particularly relevant for Israeli institutional investors with significant U.S. exposure, as dollar appreciation can offset equity declines in shekel-denominated portfolios, though it may also tighten global liquidity conditions.

Sector Dynamics and Macro Backdrop

The underperformance of small caps suggests investors are trimming exposure to domestically sensitive companies that may be more vulnerable to financing costs and economic slowdowns. Higher interest rate expectations or persistent inflation concerns could further pressure these segments.

Technology stocks, which have led gains over the past year, appear vulnerable to profit-taking amid elevated valuations. With the Nasdaq retreating more than 1%, market participants may be reassessing growth assumptions and earnings sustainability.

Meanwhile, the marginal decline in Canada’s S&P/TSX Composite index, down 0.12%, indicates relative resilience, potentially supported by energy and materials exposure.

Looking ahead, investors will monitor whether the S&P 500 can hold support near 6,800 or if selling pressure accelerates. Key risks include persistent dollar strength, rising volatility, and disappointing economic data that could undermine growth expectations. Opportunities may emerge in defensive sectors or regions demonstrating relative strength, such as emerging markets tied to commodity demand. Market participants will also watch upcoming corporate earnings and macroeconomic releases to determine whether the current pullback represents a healthy consolidation or the start of a deeper correction.