Bond Hysterics Breeding Tension in the Teetering Stock Market
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While getting a straight story on stocks verges on the impossible right now, a few generalizations can be made. One: investors aren’t waiting around to see if the bond market’s delirium strafes equities.
Hedging costs are rising, with the price for protection against a 10 percent loss in the S&P 500 Index hitting a five-month high. Volume in options tied to higher volatility -- aka, losses -- in the benchmark has been five times higher than those betting on calm for the past five days.