The A-VIX, which measures expected price volatility in the Australian share market, rocketed up almost 20% at the start of trade today, following the news that a Malaysian Airlines passenger jet was shot down over Ukraine overnight, and an Israeli ground operation in Gaza.
The Vix is sometimes called the “fear index” and represents traders’ expectations of near-term price movement. Here’s the chart showing the spike today:
Precious metals prices spiked and stocks fell on the US markets overnight following the news. The US Vix also spiked more than 30%. It follows an extended period of record low volatility on the markets in recent months.