Dow Jones Industrial Average Nosedives 223; VIX Explodes

VIX Explodes, S&P Set to Snap Quietest Streak in Years

by Josh Selway

Published on Sep 9, 2016 at 12:09 PM

The Dow Jones Industrial Average (DJIA) is falling fast at midday, giving back roughly 223 points, with not a single Dow component trading in the black. Pressuring stocks are hawkish comments from historically dovish Boston Fed President Eric Rosengren -- though Federal Reserve Governor Daniel Tarullo followed this by saying he needed to see more evidence before he'd recommend a rate hike this year. Nuclear tests in North Korea and sliding oil prices are adding to Wall Street's risk-off mentality, with October-dated crude futures giving back 2.5% to sit at $46.42 per barrel. As a result, the Dow is staring at its worst day since the "Brexit" aftermath, the S&P 500 Index (SPX) is set to snap out of its quietest streak in years, while the CBOE Volatility Index (VIX) is booming, on pace to close above a critical level

Continue reading for more on today's market -- and don't miss:

Midday Market Stats September 9

Among the stocks with unusual options volume at midday is vaccine specialist Novavax, Inc. (NASDAQ:NVAX), with the stock up 4.2% at $7.82. While put volume is also accelerated, calls are dominating the options pits, trading at 11 times the intraday norm. The October 9 call is the most popular overall, and buyers could be betting on a rally after the company unveils key vaccine data on Oct. 11. (Brokerage firm Guggenheim predicts even higher highs.) 
One of the top performers on the Nasdaq is biotech Lexicon Pharmaceuticals, Inc. (NASDAQ:LXRX), following positive drug news. The shares have added 22% to rest at $18.68, earlier touching a two-year high of $19.19. For the year, LXRX is now up over 40%. 

Daily Chart of LXRX September 9

Among the worst performers on the Nasdaq is Apple Inc. (NASDAQ:AAPL) supplier Skyworks Solutions Inc (NASDAQ:SWKS), with the semiconductor stock diving 4.8% to $68.03. While the exact catalyst is unclear, it's possibly connected to Apple's recent product launch. Still, SWKS hadn't been performing well even before today, giving back 10% since its August peak. 

The CBOE Volatility Index (VIX) is up 2.6 points, or 20.7%, at 15.10 -- above the key 14.07 level, which is half its 2016 calendar-year high close.

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.26, with puts outnumbering calls, and options running at twice the average intraday clip. The SPY is down 2.5 points, or 1.1%, at $216.04.
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