VIX Stages Double-Digit Spike As Risk Off Takes Over; Chipmakers Fail To Rebound, Weight Loss Giants Eli Lilly, Novo Tumble: What's Driving Markets Thursday?
It’s another risk-off day on Wall Street, with all major U.S. indices trading in the red. The CBOE Volatility Index (VIX), often referred to as the market’s fear gauge, spiked over 10%, reaching levels last seen in late April.
Both the S&P 500 and the Nasdaq 100 indices declined by 0.6%, while the Dow Jones Industrial Average fell 0.7%, potentially ending a streak of six consecutive positive sessions.
Small-cap stocks also succumbed to the broader negative sentiment, with the Russell 2000 index dropping 0.7%.
Chicago Fed President Austan Goolsbee, a known “dove” on the board, expressed optimism about progress on inflation and the U.S. economy’s resilience in avoiding a recession. He did not commit to a potential rate cut in September.
Following Wednesday’s sell-off triggered by concerns over increased U.S. chip export restrictions to China, semiconductor stocks remained broadly weaker, with the iShares Semiconductor ETF (NYSE:SOXX) down by 0.6%. Despite this, Nvidia Corp. (NASDAQ:NVDA) defied the trend, rising 1.8%.
Significant volatility erupted in the health care sector, particularly within the weight loss drug industry. The market duopoly of Eli Lilly and Company (NYSE:LLY) and Novo Nordisk A/S (NYSE:NVO) face heightened competitive threats from Pfizer Inc. (NYSE:PFE) and Roche Holding Ltd (OTCPK: RHHBY), both of which recently announced developments to enter this lucrative market.
Shares of Eli Lilly plunged 5.6%, marking their worst session since mid-March 2021, while Novo Nordisk shares dropped 5%, their worst performance since August 2022.
On the economic data front, jobless claims rose more than expected last week and continuing claims reached their highest level since November 2021, indicating a cooling trend in the labor market.
The U.S. dollar acted as a safe haven, rising 0.3%, while Treasury yields inched higher across the curve. The European Central Bank kept interest rates unchanged, as expected, keeping the door open for September.
In commodities, growth-sensitive copper tumbled over 3%, hitting its lowest level since mid-April. Silver eased by 0.9% and gold remained flat. Oil prices slipped 0.3%, while natural gas surged over 4%, nearly recouping Wednesday’s sharp losses following a weaker-than-expected buildup in inventories last week.
Bitcoin (CRYPTO: BTC) edged 0.4% lower, eyeing a second consecutive negative close.
Thursday’s Performance In Major US Indices, ETFs
| Major Indices | Price | 1-day %chg |
| Nasdaq 100 | 19,687.70 | -0.6% |
| S&P 500 | 5,556.41 | -0.6% |
| Dow Jones | 40,929.46 | -0.7% |
| Russell 2000 | 2,220.63 | -0.7% |
According to Benzinga pro data:
- The SPDR S&P 500 ETF Trust (NYSE:SPY) was 0.6% lower to $553.74.
- The SPDR Dow Jones Industrial Average (NYSE:DIA) fell by 0.7% to $409.10.
- The tech-heavy Invesco QQQ Trust (ARCA: QQQ) fell 0.5% to $479.14.
- Sector-wise, the Energy Select Sector SPDR Fund (NYSE:XLE) outperformed, up by 1%, while the Health Care Select Sector SPDR Fund (NYSE:XLV) lagged, down 1.5%.
Thursday’s Market Movers
- Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM) fell 0.9% despite reporting stronger-than-expected results last quarter.
- Other stocks reacting to corporate earnings were Abbott Laboratories (NYSE:ABT), down 3.5%, Alcoa Corporation (NYSE:AA), down 1%, SL Green Realty Corp. (NYSE:SLG) down 2.5%, Kinder Morgan, Inc. (NYSE:KMI), up 3.8%, Domino’s Pizza, Inc. (NYSE:DPZ), down 13%, Blackstone Inc. (NYSE:BX), up 2.6%, Marsh & McLennan Companies, Inc. (NYSE:MMC), down 1%, Alaska Air Group, Inc. (NYSE:ALK), down over 5%, Cintas Corp. (NASDAQ:CTAS), up over 6%, D.R. Horton, Inc. (NYSE:DHI), up 13%, Virtu Financial Inc. (NASDAQ:VIRT), up 18% and Novartis AG (NYSE:NVS), down 4.4%.
- Companies reporting after the close include Netflix, Inc. (NASDAQ:NFLX) and Intuitive Surgical, Inc. (NASDAQ:ISRG).
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