The CBOE Volatility Index (VIX) experienced a notable rise, closing at 16.60, driven by increased market uncertainty and expectations of approximately 1% daily movements in the S&P 500 over the next month. This uptick in volatility was fueled by dovish comments from Federal Reserve Governor Christopher Waller, suggesting potential rate cuts, which added to the market's cautious sentiment. The strong dollar and rising import prices further contributed to the unease, prompting investors to gravitate towards safe-haven assets like gold. The significant trading activity in VIX options, particularly the VIX Feb 2025 19.000 call, highlights the heightened demand for protection against potential market swings.
The iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX) saw a modest increase, closing at $43.62, up 0.16% from the previous day's close of $43.55. As of 16:40 on Thursday, January 16, the VXX was trading at $43.96, reflecting a 0.94% rise from the previous close.