Despite a slight uptick in the VIX, the market is not exhibiting significant signs of distress. The current environment reflects a reduced expectation of near-term volatility, with implied volatility on the decline and the cost of downside protection near yearly lows. This sentiment is supported by strong earnings reports from key tech companies, which have helped to stabilize investor confidence. The tech sector, although experiencing some recent declines, has not shown substantial panic, as evidenced by only marginal increases in the cost of out-of-the-money puts on the XLK ETF.
The iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX) experienced a modest increase, rising 0.37% to $43.18 as of 9:00 AM on Wednesday, January 29.