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The VIX volatility index just spiked 70%. Here's what history suggests comes next.
Yahoo Finance • • business
Key Points:
- Following Thursday's significant stock market decline, historical data indicates that the S&P 500 tends to recover, with average gains of 3.0% after one month and up to 14.7% after one year following similar extreme volatility events since 1991.
- The VIX volatility index surged by as much as 70% on Thursday, marking one of only eight such large moves in over three decades, reflecting heightened market fear amid political uncertainty after the Election Day results.
- The S&P 500 dropped 4.4%, erasing $3 trillion in market value—the largest one-day dollar loss in its history—while the Dow Jones and Nasdaq also experienced steep declines, with the Nasdaq falling 5.5% due to weakness in major tech sectors.
- Market strategists noted a "buyers' strike" in technology stocks, signaling investor caution as the market reprices risk under the prospect of Democratic control of both the House and Senate.
