Volatility weirdness

You wouldn't know it by just looking at the VIX, but volatility was on the march today. While the VIX advanced a point to 16.5, equity option volatility was sharply higher across the market on the last day of the quarter. Much of that may be due to marking - i.e. position traders pushing around the bid/ask prices to get favorable closing marks for the quarter. However, there's also a definite whiff of sub-prime fear permeating the market, just like last Feb/Mar when we had the spectacular New Century Financial blow-out. Vol seems most elevated in financials, insurance, construction, etc., just like before. However, tech seems to have a significant spike as well - that may be due to the iPhone launch and what is says about the power of blockbuster products.

At some point, the market is likely to settle down into the summer doldrums. Also, there are only 3 1/2 trading days in the US next week (July 3rd is a half day). You would think that would bring vols back in a little. We shall see.