Market Volatility Declines Sharply After Nasdaq Jumps More Than 300 Points

U.S. stocks rose sharply on Wednesday, with Treasury yields climbing to two-week highs on Wednesday following better-than-expected economic data and strong projections from some major companies.

All the three major indices settled higher, with Nasdaq settling at a three-month high level on Wednesday.

Crude oil futures, however, moved lower on Wednesday following data showing an unexpected increase in US crude and gasoline stockpiles last week.

Shares of PayPal Holdings, Inc. PYPL jumped over 9% on Wednesday after the company reported better-than-expected Q2 results and raised earnings guidance for FY22. Moderna, Inc. MRNA shares jumped 16% after the company reported upbeat Q2 results and announced a $3 billion buyback plan.

The Dow Jones rose around 1.3% to close at 32,812.50 on Wednesday, while the S&P 500 and Nasdaq Composite climbed approximately 1.56% and 2.59%, respectively in the previous session.

Majority of the sectors on the S&P 500 settled higher, with information technology and consumer discretionary stocks recording the biggest surge on Wednesday. Energy, however, was the worst performing sector in the previous session, dropping around 3%.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) dipped 8.3% to 21.95 points.

What is CBOE Volatility Index?

The CBOE Volatility Index, popularly known as VIX, is a measure of the equity market's expectation of volatility based on S&P 500 index call and put options.