On Wednesday, traders were glued to their TV’s wondering if President Obama’s first news conference since March would derail the positive momentum churning in the market.
And from the looks of things – he didn’t. The S&P traded near its highs of the session between 11:45am and 12:45pm ET - the time during which Obama spoke.
”We really have sentiment moving to the positive,” says Fast trader Pete Najarian. And if the latest moves in the Vix are any indication, Najarian thinks the trend could stick around a while.
“We’ve only had the volatility index close once below 18 since June 1st. And we’ve been trading above the 200-day since June 15th. The fact that the Vix is pulling back and is staying back on the lows of the day speaks volumes about the sentiment.”
Also Najarian says other signs are emerging that suggest the market is growing much more comfortable with risk. During an interview on CNBC, “Larry Fink of Blackrock said if he could, he would be 100% in equities. That’s a vote of confidence for the market!"
(Click here to go to BlackRock's Larry Fink Wants to Be 100% in Stocks)
Trader Steve Cortes agrees. “The tone is clearly risk-in right now,” he says. But Cortes thinks that due to developments in Europe. As you likely know, Greece’s parliament said yes to some new austerity measures, clearing the way for another bailout package.
However, if Cortes’ thesis holds true – risk may be off rather soon. He expects the market to quickly change focus from Athens to Madrid and Rome. In other words he expects financial woes to present themselves again – this time in Italy and Spain.