Despite the stock market’s big rally amid all the Election Day jitters, with volatility readings down but remaining relatively well elevated, readings of exchange data suggest investors are acting in a calm-and-collected manner. The NYSE Arms Index, a volume-weighted breadth measure, is currently at 0.975 while the Nasdaq Arms is at 0.914. The Arms tends to fall below 0.000 during market rallies, as buying becomes more aggressive in gaining stocks; a drop to below the 0.500 level would suggest panic-like buying behavior. But on Tuesday, the Arms is barely budged despite the Dow Jones Industrial Average surging 538 points, or 2.0%, and the Nasdaq Composite climbing 1.9%. On Monday, with the Dow up 423 points, the NYSE Arms was at 0.531, and on Oct. 7, when the Dow jumped 531 points, the NYSE Arms was 0.561. Meanwhile, the CBOE Volatility Index , often referred to as the market’s fear gauge, is down 4.9%, but at 35.31 it remains well above the 2020 daily average of 30.43.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
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