Fear index spikes on Greek woes

By Blake Ellis, staff reporter


NEW YORK (CNNMoney.com) -- Wall Street's key index of volatility hit its highest level in more than two months Tuesday as worries about Greece's spreading debt crisis topped the already long list of investors' concerns.

The VIX (VIX), which gauges fear in the market, surged more than 18% to close at 23.84 on Tuesday.

That's the highest reading since the middle of February and up 53% since early April, when the VIX was trading at its lowest level in nearly three years.

Markets were rattled Tuesday as investors worried that the $146 billion aid package for Greece, announced over the weekend, would not prevent debt problems from spreading to other euro zone countries.

"When we finally did address the Greece situation, the market doesn't believe it or just thinks that there's another shoe about to drop," said Joseph Saluzzi, co-head of equity trading at Themis Trading.

Greece is a member of the so-called PIIGS, a collection of five debt-laden European nations. Many investors fear that Spain and Portugal could be two of the next countries to need financial assistance.

"This is not an isolated situation, because if it was just one country, the market would get over it," Saluzzi said. "It looks like we're now going to see the ramifications of this."

But it's not just concern over sovereign debt that's causing the VIX to surge, said Saluzzi.

"At this point there are just so many issues out there," he said. "You can pick anything, whether it's any country in Europe, the oil spill, volcanic ash or Goldman Sachs -- the market is having a hard time."

Given these lingering fears, Saluzzi said he wouldn't be surprised if the index continued to climb in the next few weeks, meaning stocks may be in for a rough ride.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.94%3.93%
15 yr fixed3.03%3.03%
5/1 ARM3.33%3.27%
30 yr refi4.02%3.99%
15 yr refi3.09%3.07%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 16,461.32 -153.49 -0.92%
Nasdaq 4,382.85 -36.63 -0.83%
S&P 500 1,927.11 -14.17 -0.73%
Treasuries 2.23 0.02 0.95%
Data as of 11:10pm ET
Company Price Change % Change
Bank of America Corp... 16.40 -0.20 -1.20%
Yahoo! Inc 42.00 1.82 4.53%
Apple Inc 102.99 0.52 0.51%
Facebook Inc 78.37 -0.32 -0.41%
Boston Scientific Co... 12.32 0.29 2.41%
Data as of 4:04pm ET

Sections

Las Vegas might have first class shopping, dining and nightlife. But for serious gambling, head to Macau. More

The midterm elections are around the corner, and the economy remains a top concern. With unemployment down and inflation low, why do people still feel the economy stinks? More

Uber canceled its free rides with hot girls promotion in Lyon, France before it ever launched. More

Startups focusing on "ag tech," or agricultural technology, are gaining the attention of farmers and investors More

Dressing up in crazy costumes, traveling the world, posing for photos -- and getting paid to do it. Here are journal entries from a day in the life of professional "cosplay" character, Linda Le. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.