The CBOE Volatility Index dropped below 14 on Friday for the first time since October as VIX-futures products such as iPath S&P 500 VIX Short Term Futures ETN (NYSEArca: VXX) lingered near all-time lows.
Wall Street’s so-called fear gauge was lower while the major U.S. stock indices were little changed after the government said the economy added 155,000 jobs in December.
“It’s not an incredibly strongly labor market but it’s mending and it’s going to continue to take time,” Greg Woodard, a strategist at Manning & Napier, told Bloomberg News. “The market realized there’s some outside help. The Fed continues to provide a lot of liquidity.”
VXX was down 1.5% in midday trading Friday while other volatility-linked exchange traded products such as VelocityShares VIX Short-Term ETN (NYSEArca: VIIX), VelocityShares Daily 2x VIX Short-Term ETN (NYSEArca: TVIX), ProShares Ultra VIX Short-Term Futures (NYSEArca: UVXY) and ProShares VIX Short-Term Futures ETF (NYSEArca: VIXY) were also in the red. [Volatility-Linked ETFs Still Crashing with VIX on Fiscal Cliff Deal]
Friday’s jobs report showed the unemployment rate was unchanged at 7.8% last month.