S&P 500 Drops as Rate Hike Fears Grow

The S&P 500 opened down 56 points, or 0.73%, on September 14, 2026, as investors shifted expectations regarding Federal Reserve monetary policy. Traders are now pricing in a potential rate hike at the upcoming meeting, reversing previous expectations of a rate cut. This shift pressured rate-sensitive sectors, including utilities, real estate investment trusts, and high-multiple technology stocks, as the market monitors whether the index can maintain the 7,600 level.

Savita Subramanian, a strategist at Bank of America, warned that the market is overdue for a pullback, noting that the S&P 500 has seen only one 5% decline in 2026 compared to a historical average of three per year. She cited weak near-term seasonality for September and October, high Treasury yields, and concerns over artificial intelligence safety as primary pressures.

While Subramanian maintains that the long-term bull market remains intact due to stable jobs and consumer data, she expects limited near-term upside. She raised her year-end 2026 forecast to 7,400, implying a 3.4% decline from recent levels, and noted that 50% of the firm's bear market signposts are currently triggered.