Friday, June 18, 2010
The Vix index has dropped to 24 after spiking to 48 on May 21st. 2-yr swap spreads are now back to "normal" levels of 34 bps, after spiking to 64 on May 25th. The surge in the Vix and in swap spreads preceded the slump in the S&P 500, which reached a low on June 4th. It would appear to me that with fear, uncertainty and doubt fading fast, the equity market looks poised to enjoy some handsome gains in the days and weeks ahead.
Here's a close-up of the Vix and swap spreads:
Posted by Scott Grannis at 11:25 AM