(Bloomberg) — Stocks fell for a second day as Trump trades lost steam and investors bet the Federal Reserve will have to slow the pace of policy easing.

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The S&P 500 traded near session lows, with tech stocks leading declines. Including losses on Friday, the benchmark has now ceded more than half of the trough-to-peak gains it notched after the US presidential election. Traders now see just over even odds of a quarter-point cut next month after a report on October retail sales included large upside revisions to the prior month.

As the initial euphoria about Trump’s pro-business agenda begins to fade, investors are coming to terms with the costs of his fiscal plans and their potential to reignite inflation.

“It will come at the expense of potentially larger budget deficits, potentially larger debt and there is also the inflation dimension,” said Charles-Henry Monchau, chief investment officer at Banque Syz & Co. “There’s been a realization that there is a price to pay for this.”

The S&P 500 fell 1.5% and the tech-heavy Nasdaq 100 dropped more than 2%. Shares of all “Magnificent Seven” megacaps declined except Elon Musk’s Tesla Inc., with Amazon.com Inc., Nvidia Corp. and Meta Platforms Inc. sliding more than 3%.

Traders priced just over a 50% chance the Fed will deliver a quarter-point reduction at its December meeting, down from 80% earlier this week. Bets on cuts were pared after Fed Chair Jerome Powell warned Thursday that the central bank may take its time easing policy. Boston Fed President Susan Collins said Friday a December cut remained on the table, emphasizing the central bank’s decision will be guided by incoming data.

“The market is expensive and I think Powell’s speech last night basically saying that Fed officials don’t need to rush to lower rates, that’s probably the main reason why we’re selling off specifically today,” said John Davi, CEO and CIO at Astoria Advisors, by phone. “The higher rates go, the more equity risk premiums tilt more in the favor of bonds.”

Meanwhile, drugmakers Moderna Inc. and Pfizer Inc. came under pressure in New York trading after Trump named a prominent vaccine skeptic Robert F. Kennedy Jr. to a top health-policy role.

The greenback eased off two-year highs but is on track for its seventh straight weekly gain. Another of the so-called Trump trades, Bitcoin, has given up some gains this week, trading below $90,000 on Friday after hitting a record level above $93,000 earlier this week on hopes of crypto-friendly policies from the new US administration.

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