Volatility In Markets Increases Ahead Of Fed's Rate Decision

US stocks closed lower on Friday, as investors digested recent economic data and awaited interest-rate decision from the Federal Reserve this week.

US producer prices increased slightly higher than expected during the month of November amid an increase in services costs.

Futures trades now see a 77% chance that the US Federal Reserve will raise interest rates by 50 basis points at its upcoming meeting.

Data on consumer prices, due tomorrow, is also expected to provide fresh insights on the Fed’s monetary tightening plans.

Shares of Netflix, Inc. NFLX gained over 3% on Friday after Wells Fargo upgraded the stock from Equal-Weight to Overweight and raised its price target from $300 to $400.

Majority of the sectors on the S&P 500 closed on a negative note, with energy and health care stocks recording the biggest plunge on Friday. However, communication services stocks settled slightly higher in the prior session.

The Nasdaq 100 fell 0.64% to close at 11,563.33 on Friday, amid a decline in shares of Microsoft Corp MSFT and Amazon.com, Inc. AMZN. The S&P 500 declined 0.73%, while the Dow Jones lost 0.90% to 33,476.46 in the previous session.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) rose 2.4% to 22.83 points on Friday.

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.