VIX Sees 12-Week High, Rises to 21
With the Bears entering the stock market, the optionsmarket finally joined their fears with a 12-week high in the VIX today.
After sticking in the 18-19 range for quite some time as thestock market dropped, the VIX reached its highest intraday level sinceMarch 23. Rising 16 percent to 21.19 at 12:30 EDT, this increase came inrelation to reports showing a slowing economy.
Earlier today, a combination of rising inflation andweaknesses in the manufacturing and industrial sector reflected an increasinglyweak economy. The deepening Greece debt crisis is affecting currency and European markets and adding to the gloomy economic news.
In response to the increased VIX, Michael Schwartz,Oppenheimer & Co.'s chief options strategist said in a Dow Jones article, "TheVIX is not reflecting a negative or fearful situation."
In March, the VIX briefly rose above 30 in response to Japan's nuclear crisis and the subsequent market sell-off. With continuous bad news in the market, will we see the VIX rise even more by week's end? Thereís still a chock-full of economic reports this week that could affect the market.
Housing starts/building permits and jobless claims
Weekly Fed Data
Bloomberg consumer comfort Index
- University of Michigan confidence survey
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