Waning Confidence in Trump Trade Drags on Stock ETFs

U.S. equities and stock exchange traded funds plunged Tuesday as traders grew pessimistic over President Donald Trump’s ability to enact a number of expansionary policies in a timely fashion.

The S&P 500 Index, along with related funds including the SPDR S&P 500 ETF (NYSEArca: SPY), iShares Core S&P 500 ETF (NYSEArca: IVV) and Vanguard 500 Index (NYSEArca: VOO), declined 0.9% Monday.

The financial sector were among the worst hit areas of the market, with Financial Select Sector SPDR (NYSEArca: XLF) down 2.5% Monday.

U.S. equities have been rallying since the election on hopes and optimism that the new Trump administration would enact pro-growth policies to fuel the high-flying market valuations. However, some traders and investors are expressing concerns that the Trump trade is overbought, which makes the equities market vulnerable to quick turns.