European stock indices had mixed outcomes. Germany, the UK, and Spain made gains, while France and Italy saw declines. The UK’s FTSE 100 hit a record close of 9012.99 but didn’t quite reach Friday’s peak of 9016.36. In Germany, the DAX finished at 24298.17, remaining 250 points shy of its record high of 24549.57. Here are the final closing numbers: – German DAX: up 0.04% – France’s CAC: down 0.31% – UK’s FTSE 100: up 0.23% – Spain’s Ibex: up 0.30% – Italy’s FTSE MIB: down 0.36% As European markets closed, US indices also climbed. The Dow gained 238.69 points (0.54%), the S&P rose by 37 points (0.59%), the NASDAQ increased by 150 points (0.72%), and the Russell 2000 advanced by 15.40 points (0.69%).

Netflix Share Performance

Netflix shares increased by $10.52 (0.87%) to $1,219.76 after a drop post-earnings, despite meeting revenue and EPS expectations. Earlier, shares sunk to a low of $1,198, the weakest level since June 11, before bouncing back but still staying below the 50-day moving average of $1,228.77. With US markets rising, the CBOE Volatility Index (VIX) is near 12, well below its historical average of around 19. This indicates market complacency, making protective put options on indices like the S&P 500 relatively affordable. We see it as wise to start purchasing this low-cost insurance against any unexpected downturns in the near future. The mixed results in Europe, noted by Michalowski, show underlying economic differences. Recent data reveals Eurozone annual inflation steady at 2.4%, slightly higher in the UK. This supports using options to exploit the performance gap between the record-setting FTSE 100 and the underperforming French CAC. We’re looking at bull call spreads on UK-focused ETFs and bear put spreads on their French counterparts.

Implications of US Federal Reserve Decisions

The rally in US indices is mainly due to optimism that the Federal Reserve will lower interest rates, particularly after the latest Consumer Price Index report showed inflation easing to an annual rate of 3.4%. We anticipate increased volatility around upcoming inflation reports and Fed announcements, making calendar spreads on the SPDR S&P 500 ETF (SPY) an appealing way to trade the expected rise in implied volatility. Focusing on Netflix, its bounce from a recent low while still below a key technical moving average presents a unique opportunity. We can sell cash-secured puts with a strike price below the recent $1,198 low to collect premium from ongoing uncertainty. This strategy works if the stock maintains its current levels or allows us to buy shares at a discount if it drops. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now