Despite the stock market experiencing a decline, options positions still favor an increase in the SPX and Nasdaq indices.😃
Equities had a weak session with the Nasdaq falling almost 1%, blaming higher yields but also a news report that Chinese government agencies are barring the use of iPhones and other foreign-made devices at work. Apple shares sold off 3%, spearheading a -1.3% sell-off in the SPX tech index. Despite the sell-off, equity option positioning remains positively skewed, with the implied equity distribution substantially ‘skewed to the right’ on further gains in the SPX and Nasdaq. On the other hand, the daily implied volatility on the SPX remains very contained, showing barely any noticeable bumps on the upcoming CPI and NFP, and a smaller than usual premium even on the upcoming FOMC meeting.
