Remy Blaire: It is lunchtime here in New York. It is 11 a.m. in Chicago over at Cboe.
So let's head on over to FINTECH.TV correspondent Mark Payton, who's live from the trading floor.
Hey, Mark. Thanks for joining us again. So get us caught up on everything that you're seeing over from Cboe.
Mark Payton: Yeah. Hi, Remy.
A lot to watch here as we move through the trading day.
First, the VIX is right around 14.7 this morning. That's still a relatively low level for volatility, even with some pressure on stocks today, but still up 3% on the day.
We're also keeping a close eye on small caps and the Russell 2000. It's around 2,860, down about 1%.
Now, with Treasury yields pushing higher, this is one to watch closely today.
And that brings us to one of the biggest numbers on the board today. The 10-year Treasury yield has moved back above 5%, as you mentioned.
And there's a really interesting connection between rates and oil right now.
Cboe research shows the three-month correlation between WTI crude and the 10-year Treasury yield has jumped to 65%, its highest level in 35 years.
So, in other words, oil and Treasury yields have been moving together much more closely than usual.
And oil remains a major part of today's story, with WTI around $90 to $91 a barrel, while Brent is trading around $100.
So here at Cboe, those are some of the big numbers we're watching: volatility, small caps, Treasury yields and, of course, oil.
Remy Blaire: Yeah. And indeed, as you mentioned, we are seeing volatility higher.
And it's not surprising given that move we've been watching in the 10-year yield as well as oil prices.
So how are prediction market traders thinking about oil's next move?
Mark Payton: Yeah, this is interesting because Polymarket is putting probabilities around where WTI crude actually finishes today.
Right now, traders are putting about a 67% chance WTI closes above $90 a barrel.
Move that up to $91, and it's basically a coin flip, about 48%.
Above $92, it drops to about 28%, and above $93, it's only around 13%.
So you can really see the probabilities fall off once you get above the $91 level.
And what makes this especially interesting is how quickly those probabilities can change as the underlying price of crude moves.
This is essentially a real-time snapshot of how traders are repricing where they think WTI will settle today.
And with Cboe showing that unusually strong relationship between oil and Treasury yields right now, where crude finishes today could be another important piece of the rates and inflation story.
Remy.
Remy Blaire: Yeah, a lot to keep our eyes on.
Mark, appreciate your time. Thank you so much for joining us this morning from Cboe.
Mark Payton: Thank you.
