NEW YORK (TheStreet) -- Markets couldn't make up their minds on Tuesday. Stocks wiped out gains in the final market hour after a whiplash session which saw the Dow Jones Industrial Average trading in a 360-point range.
The Chicago Board Options Exchange Volatility Index, sometimes known as the 'fear' index, spiked 6% as investors were torn between stabilizing oil prices, hopes that the Federal Reserve will maintain its current monetary policy, and Russia teetering on recession in the face of tumbling natural gas prices.
"We've got a market here that's looking a little tired as it nears its final two weeks of the year," said Sean Lynch, Wells Fargo managing director of global equity research, in a call. "You have the problems in Russia, you have concerns over lower oil prices and then you have the FOMC meeting tomorrow." The FOMC, or
The S&P 500 closed 0.84% lower, the Dow fell 0.64% and the Nasdaq tumbled 1.2%.
Crude oil prices appeared to have found a bottom with West Texas Intermediate flat at $55.95 a barrel. Prices skidded on Monday after key OPEC members recommitted to leaving production levels unchanged despite global oversupply.
"If you look at a technical chart, the long-term price chart of crude oil, the low-$50s (roughly that $53-$55 range) coincides with long-term support," said LPL Financial investment strategist Anthony Valeri over the phone. "It could just be a technical bounce but it's something the markets are getting excited about."