The S&P500 fell 2.3%, the worst since the end of 2022. Alphabet and Tesla presented results that did not convince the market and a new debate on technology companies has begun.
The sharp drop in the US stocks made the indicator of market volatility most followed by Wall Street to reachat its highest level in three monthss, which boosted options trading volume on Wednesday, even though strategists saw no signs of panic.
He S&P 500 fell 2.3%, its worst daily drop since late 2022after Tesla and Alphabet (Google) reported poor results, leading investors to question whether the 2024 rally driven by Big Tech and AI is sustainable.
The Nasdaq led the decline of the three main indices with a drop of 3.64%. The least affected index was the Dow Jones, which closed with a drop of 1.25%.
volatility.png
The CBOE Volatility Index – known as Wall Street’s fear gauge – soared to 18.46, the highest level since late April. VIX options changed hands at nearly twice the usual rate on Tuesday, according to Trade Alert data.
What were the reasons that triggered the fear index on Wall Street?
Sales have highlighted thethe vulnerability of the market in general before any weakness of big tech, that have driven the indexes higher despite concerns about inflated valuations, reminiscent of the dotcom boom of more than two decades ago. However, the decline so far has been more of a orderly withdrawal than a correction, according to agents in the options market.
“We’re not seeing a lot of fear in the market, which means people aren’t going out and trying to aggressively buy protection,” said Matthew Tym, head of equity derivatives trading at Cantor Fitzgerald. “It’s very orderly and somewhat passive, which tells me that nobody is in a bad situation yet.”
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
