Stocks Retreat as VIX Hits 30
The Dow Jones, S&P 500 and Nasdaq Composite Index declined on Tuesday.
The Dow and broader U.S. stock market were back on the defensive Tuesday, as investors awaited new policy directions from the Federal Reserve.
Wall Street’s major indices were lower at the close, with the Dow Jones Industrial Average (DIA) falling 66.83 points, or 0.2%, to 34,297.67.
The broad S&P 500 Index (SPY) of large-cap stocks declined 1.2% to settle at 4,356.41. Most sectors finished in negative territory.
Meanwhile, the technology-focused Nasdaq Composite Index (QQQ) declined 2.3% to close at 13,538,29.
A measure of implied volatility known as the CBOE VIX (VXX) rose on Tuesday. The so-called “investor fear index” reached an intraday high of 35.85 on a scale of 1-100, where 20 represents the historical average. It would eventually settle up 2.8% at 30.75.
In commodities, oil prices rose on Tuesday, as U.S. West Texas Intermediate gained $2.06, or 2.5%, to $85.37 a barrel on the New York Mercantile Exchange. Brent, the international futures contract, rose $1.84, or 2.1%, to $88.11 a barrel.
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In precious metals, gold prices rose, as the February futures contract climbed $6.70, or 0.4%, to $1,850.90 a troy ounce on the Comex division of the New York Mercantile Exchange. Silver futures rose 11 cents, or 0.5%, to trade at $23.91 a troy ounce.
The Final Word: Equity markets remained under pressure in anticipation of the Federal Reserve’s policy decision and fourth-quarter earnings reports. Markets are expected to remain volatile until the Fed releases its official policy statement Wednesday afternoon.