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Investing.com -- Wall Street's main indicator of investor anxiety reached an eight-month high on Monday, as US stocks continued their downward trend from the previous week. This comes amid concerns about the potential impact of US President Donald Trump's tariff policy.
The Cboe Volatility Index, an options-based measure of investor anxiety often referred to as Wall Street's 'fear gauge', surged by up to 14.82 points, reaching 60.13. This is the highest level it has seen since August 5. After hitting its highest closing level in five years on Friday, the index was last recorded up by 4.52 points at 49.83.
As Wall Street's primary equity indexes opened with a significant drop, the S&P 500 is nearing confirmation that it is in a bear market, which is defined as a 20% decline from a record high.
In August, the VIX experienced a record surge as traders hastened to guard against market volatility during a worldwide selloff driven by fears of a US recession. Despite this, the index marked a record decline as investors swiftly returned to strategies that rely on low stock volatility.
Nevertheless, the recent rise of the VIX has reached levels that historically have signaled a peak in selling, potentially leading to a temporary halt in the market's descent.
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