Key Takeaways with Craig

What started as a day that looked like it would have all of the hallmarks of a traditional “risk off” or “flight to quality” day in the markets turned around dramatically in early afternoon trading action.  US Equity prices were sharply lower, Gold prices were higher, Treasury yields declined and WTI Crude Oil futures at CME hit $100 per barrel early in the day after Russia staged a “full-scale’ invasion of Ukraine.  However, by the time the dust had settled on the day, E-mini Nasaq-100 futures prices were up by over 3%, US Treasury yields were little changed and Gold futures prices had declined from yesterday’s close. 

Certainly, we’re not going to prognosticate on the impact that the sanctions President Biden announced might have on Russia nor the world economy nor even on what might happen tomorrow, but at least for today, the market was able to rebound from the initial price moves. 

Perhaps it comes as no surprise, but even with the recovery we saw this afternoon in equity prices, implied volatility in options in all six major CME Group asset classes (Energy, Equity Indexes, Metals, FX, Interest Rates and Ags) remain well above a one-standard deviation move relative to the last 6 months, reflecting the ongoing uncertainty in global financial and commodity markets.  The blue line in the QuikStrike graph below shows the elevated level of implied volatility in the 10-Year Treasury Note options, even after the futures were little changed today.

We hope this finds our In FOCUS readers well and we’ll be back tomorrow.  

Today's Future Price Action

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