Wall Street’s ‘Fear Gauge’ Rears up as Brexit Vote Approaches

VIX touches 20, implying that investors are starting to get spooked

by Mark DeCambre
Market Watch

The market’s so-called fear index has gathered momentum ahead of a referendum that could help determine the U.K.’s continued membership in the European Union.

The vote scheduled for Thursday has become one of the financial world’s sharpest points of anxiety. The main concern is that if Britons opt to exit the EU, markets world-wide will be roiled. An online survey by Opinium on Wednesday implied that the odds of a “Brexit” are the about the statistical equivalent of a coin toss.

That uncertainty has put pressure on the S&P 500 index SPX, -0.17% and the Dow Jones Industrial Average DJIA, -0.27% which relinquished morning gains on Wednesday to close near session lows. As a result, the CBOE Volatility Index VIX, +14.56% or VIX, which tracks S&P 500 options prices, climbed above 21. That’s up more than 9% on the day.

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