Late Day Rally Makes it More Bearable for the Bulls
Stocks closed off the lows but were under pressure across the board most of the session due to the unfolding situation in Japan as well as the Bahrain developments. Growing concerns about the state of the global economy remain an overhang also. There was some derisking occurring, but the selling was not panicked. The absence of buyers had as much of an impact on trading as the selling. Corporate news is quiet this week, but volumes will be elevated due to quad witching and the S&P/NASDAQ rebalance taking place after the close on Friday.
The Dow Jones Industrial Average ended down 51.24 points, or 0.43%, to close at 11,993. The S&P 500 fell 7.89 points, or 0.60%, to close at 1296, and the NASDAQ was down 14.64 points, or 0.54%, to finish at 2700.
Commodities were mixed as the dollar ended near its lows of the day.
The CBOE Volatility Index (VIX) closed up 5.23%, at 21.13, on overall put volume of 217,000 contracts compared to 495,000 call contracts, with March 30 calls as the most active series. 60 and 90-day implied volatility moved lower from the close yesterday to trade at 75 and 69, respectively, indicating decreasing price movement in the outer months.
SPDR S&P 500 ETF (SPY) March put volatility ticks up to 19 and May to 21 on the Japan disaster, FOMC meeting and quadruple expiration this Friday. SPY closed lower by $0.79, at $130.05, on overall put volume of 1.46 million contracts compared to 782,000 call contracts, with March 130 puts. 60 and 90-day implied volatility is 19 and 20, respectively, suggesting slightly higher increasing price movement in the outer months.
PowerShares QQQ Trust (QQQQ) closed down $0.20, at $56.29, on overall put volume of 326,000 contracts compared to 244,000 call contracts, with March 55 puts as the most active series. 60 and 90-day implied volatility is at 22, indicating little price movement in the outer months.
The following companies are reporting the week of March 14: Monday before the open: EBIX, GPOR, TNDM, PNY, SSW; Tuesday before the open: BWS, DSW, FDS, FSS; after the close: AIR, PSUN, RUE, VRA; Wednesday before the open: SUP; after the close: AXAS, CLC, GMR; Thursday before the open: FDX, LULU, ROST; after the close: NKE, SCVL.
Economic Data for the week of March 14: Tuesday: March Empire Manufacturing, February Export Prices, February Import Prices, January Net Long-Term TIC Flows, March NAHB Housing Market Index, March FOMC Rate Decision; Wednesday: 3/11 MBA Mortgage Index, February Housing Starts, February Building Permits, February PPI, Q4 Current Account Balance, 3/12 Crude Inventories; Thursday: 3/12 Initial Claims, February CPI, February Industrial Production, February Capacity Utilization, February Leading Indicators, March Philadelphia Fed Survey.
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