A popular gauge of volatility, or fear, on Wall Street surged by the most since mid-May on Thursday as the stock market in afternoon trade suffered sharp losses in the technology sector XLK, -1.91% The CBOE Volatility Index VIX, +35.79% was up about 39% at around 14, putting it on track for its largest daily surge since May 17, when it climbed more than 46%, according to FactSet data.
The so-called VIX, otherwise known as the fear gauge, measures options bets on the S&P 500 index SPX, -0.83% 30 days in the future and is used by traders to wager on sharp swings in the market. Wall Street stocks were facing a firm drop, led by the Nasdaq Composite Index COMP, -1.68% which was trading 1.7% lower, while the S&P 500 index was off 1%. The Dow Jones Industrial Average DJIA, -0.73% sank 0.9% Thursday afternoon.
One prominent way to bet on the tech sector, the Technology Select Sector SPDR ETF XLK, -1.91% was down 2.2%, pacing its worst one-day drop since June 9, when the overall tech sector unraveled on fears that tech giants like Amazon.com Inc. AMZN, -1.77% Netflix Inc. NFLX, -2.31% and Google-parent Alphabet Inc. GOOG, -2.14% GOOG, -2.14% had risen too far, too fast. Thursday’s moves, however come after Wall Street saw its best daily climb in seven months.
via MarketWatch
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Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
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