The latest nonfarm payrolls report has injected a fresh wave of uncertainty into the markets, leading to heightened volatility expectations. Rising bond yields and persistent inflation concerns have prompted investors to brace for potential market swings. The options market is currently pricing in a significant move in the S&P 500, reflecting the largest implied volatility on a jobs day since September. This has led to an increase in the VIX, the market's "fear gauge," as traders seek protection against potential fluctuations amid strong job growth and high inflation.
The ProShares Short VIX Short Term Futures ETF (SVXY) has reacted to these developments, with its price declining by 1.65% to $48.83 as of 10:40 AM on Wednesday, January 8.