Job Openings Hit Seven-Year High

At noon, the stock market is down but not by much. There’s been a lot of talk recently about the ultra low VIX level. The VIX is currently at 11.23, which is quite low, but remember that the VIX only looks one month ahead while stock prices are theoretically supposed to discount to eternity.

I’ve looked at the numbers and found that the VIX isn’t that strongly correlated with a good or bad market. The closest I’ve found is that a low VIX, below 13, is somewhat good for the market. Since 1990, the S&P 500 has gained 11.79% annualized when the VIX is below 13, and 6.36% annualized when it’s 13 or more.

What I think low volatility means is that the market has settled on a trend, whatever it may be, and sees it playing out for a while.

There’s not much in the way of economic news today. One report we got was on job openings. The number of job openings nearly hit a seven-year high in April. There are now 4.46 million jobs waiting to be filled which is the highest since September 2007.

Another report said that small businesses are the most optimistic they’ve been since 2007. It’s interesting how many data series have been making seven-year highs. Last week, non-farm payrolls finally took out its pre-recession high.

On our Buy List, most stocks are quiet but CR Bard ($BCR) and Cognizant Technology Solutions ($CTSH) are both down more than 3% today. CTSH was downgraded by Susquehanna to neutral from positive.

Facebook ($FB) is up on the news that PayPal’s president is jumping ship to FB. PayPal, of course, is a subsidiary of eBay ($EBAY). I don’t think this means much for eBay but its shares are down about 2% today.

Posted by on June 10th, 2014 at 12:02 pm


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