Fear & Greed Index Trends Upwards Amid Market Optimism
Market sentiment, as reflected by the CNN Money Fear and Greed index, has continued to show improvement, maintaining its position in the “Greed” zone on Tuesday.
U.S. stocks closed in a mixed fashion, with the Nasdaq Composite settling slightly higher during the session. Nvidia Corp. NVDA shares soared to a new all-time high, adding to the positive sentiment.
Juniper Networks, Inc. JNPR saw its shares surge approximately 22%, driven by reports suggesting a potential acquisition by Hewlett Packard Enterprise Company HPE.
On the economic front, the NFIB Small Business Optimism Index rose to 91.9 in December from 90.6 in November. Additionally, the US trade gap narrowed to $63.2 billion in November from $64.5 billion in the previous month, defying market estimates of a $65 billion gap.
The eagerly anticipated consumer price index for December is scheduled for release on Thursday, with the producer price index following on Friday.
Despite most sectors on the S&P 500 closing negatively, the technology and consumer staples categories bucked the trend, closing the session on a positive note.
The Dow Jones closed lower by around 158 points at 37,525.16 on Tuesday. Similarly, the S&P 500 dipped by 0.15% to 4,756.50, while the Nasdaq Composite bucked the trend and rose by 0.09% to 14,857.71.
Investors are eagerly awaiting earnings results from KB Home KBH, Rocky Mountain Chocolate Factory, Inc. RELL, and Rocky Mountain Chocolate Factory, Inc. RMCF today.
The Fear & Greed Index, currently at a reading of 72.6, remained in the “Greed” zone on Tuesday, representing a brisk acceleration from a prior reading of 61.4.
Understanding the CNN Business Fear & Greed Index
The Fear & Greed Index serves as a gauge of the current market sentiment, based on the notion that heightened fear puts downward pressure on stock prices, while an increased sense of greed has the opposite effect. It is calculated using seven equitably weighted indicators and portrays a range from 0 to 100, with 0 signifying maximum fear and 100 indicating utmost greediness.