‘Volatility genie may not be back in bottle’

Bloomberg|
Mar 12, 2018, 08.22 AM IST
0Comments
sTOCKS--TS

The Cboe Volatility Index’s 11 per cent drop to 14.64 means it ended Friday’s session.

New York: The VIX may not be sending an all-clear sign for the markets, according to Jeffrey Gundlach.

The markets are at an “important crossroads,” Gundlach, the billionaire bond manager who is chief executive officer of DoubleLine Capital, said in the Twitter message late Friday. But he also asked, is the “genie back in the bottle? I’m skeptical.”

The Cboe Volatility Index’s 11 per cent drop to 14.64 means it ended Friday’s session below the highest close of last year, 16.04 on August 10. This year has been a different story, of course, with the gauge soaring above 50 in intraday trading during the market meltdown in early February.

While stocks did suffer amid that bout of volatility, they’ve also recovered quickly despite concerns ranging from the effect of President Donald Trump’s tariffs to the potential interest-rate-hike path of the Federal Reserve. The S&P 500 is back above its 50-day moving average, and technology stocks have returned to record levels. Still, it remains to be seen if equities can continue to climb the so called “wall of worry.”

In January, during his annual “Just Markets” webcast, Gundlach said that a level of 3 per cent on the 10-year US Treasury yield would signal the end of the three-decade long bond bull market. It hasn’t broken through that level yet, though has come close, rising above 2.95 per cent on February 21. He also said commodities will outperform in 2018 amid a late-cycle boom.

volatility--snip

0Comments
Read more on

Also Read

Wall Street slips in volatile trading

GOP crusader Walker reaches to center in volatile Wisconsin

Volatility says little about outlook for stocks

Vishal Khandelwal on how to invest in the time of volatility

Gold prices riding piggyback on volatility in dollar index

Comments
Add Your Comments

From Around The Web

How to fix your Fatigue (do this every day)!

GundryMD

Arijit Singh Live in the U.S.-Book tickets now for 1+1 offer

Gaana Music Fest

Send Money to India for $0 + Great Exchange Rates

Vianex

California Launches No Cost Solar Program

Energy Bill Cruncher Solar Quotes

More from The Economic Times

Mumbai is now the 16th most expensive city

TDP's shock move gets an unexpected backing

In northeast, it may not actually be a BJP wave

Why PM Modi can't give what Chandrababu Naidu wants