The recent surge in the CBOE Volatility Index (VIX) by 8.14% to close at 19.54 has been a key driver of market dynamics, reflecting heightened volatility expectations. This increase comes amid a backdrop of declining equity markets, with the S&P 500 Index falling by 1.54%. The robust US payrolls report has altered market expectations regarding Federal Reserve rate cuts, leading to rising Treasury yields and putting pressure on equities. This economic environment has contributed to the VIX's upward movement, as investors brace for potential market fluctuations. The upcoming earnings season, particularly from major banks, is anticipated to further shape market sentiment.
The ProShares Short VIX Short Term Futures ETF (SVXY) experienced a decline, dropping 3.42% to $47.94 as of 4:40 PM on Friday, January 10.