MOVE Is Back: Stocks Should Pay Attention

On the MOVE

Rates volatility is starting to wake up again. Bond volatility, MOVE, has surged higher lately. The reset in bond volatility we saw after the Liberation Day crisis is now clearly gone. MOVE has not closed this high since November last year.

Source: LSEG Workspace

 

Still shy

Bond volatility is still relatively shy compared to the moves in VIX and oil volatility (OVX). But rates remain a crucial piece of the macro puzzle from here, and the post-Iran war outlook is far from clear.

Source: LSEG Workspace

 

That gap vs SPX

SPX does not like surging bond volatility. The short-term gap between SPX and MOVE (inverted) has widened sharply. Watch this divergence closely.

Source: LSEG Workspace