STOCKS NEWS US-VIX falls below key Fibonacci retracement level

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U.S. stock market report [.N] 1214 ET 18Dec2008-VIX falls below key Fibonacci retracement level ------------------------------------------------------------------------------

The CBOE Volatility Index .VIX fell more than 10.7 percent to as low as 44.50, below a key 61.8-pct Fibonacci retracement level of its surge from late August to late October. Traders could next eye 42.16, the interim high seen shortly after the Lehman collapse.

(Reuters Messaging: rodrigo.campos.reuters.com@reuters.net) 1135 ET 18Dec2008-Volatility expected below recent levels ------------------------------------------------------------------------------

Volatility below recent levels is expected in U.S. markets for Thursday's and Friday's sessions, as expiration and settlement of December option and futures contracts for both single stocks and stock indexes, an event known as quadruple witching, is in play.

In terms of market volatility for the sessions "I think it's going to be less volatile than it has been for the last several weeks, but in historic terms it is still very high," said Michael McCarty, options strategist at Meridian Equity Partners.

The CBOE Volatility Index .VIX or VIX fell to a six-week low and the S&P 500 index .SPX was up less than 0.1 percent.

Reuters Messaging: rodrigo.campos.reuters.com@reuters.net 1106 ET 18Dec2008-Discover Financial rises after earnings ------------------------------------------------------------------------------

Shares of Discover Financial Services (DFS.N) rose on Thursday after the company reported a fourth-quarter net profit, which included a $535 million gain from a litigation settlement. [ID: nN18468171]