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Volatility in financial markets at record highs: S&P Global

(Reuters) – Volatility in financial markets across geographies and asset classes is at record highs as the relentless spread of the coronavirus outbreak threatens to derail global economic growth, analysts at U.S. stock market index operator S&P Global said.

The company, which runs Wall Street’s Dow Jones <.DJI> and S&P 500 <.SPX> indexes, said the only comparison for the past month’s sell-off on equity and other markets historically was the 2008 financial crash.

All the main U.S. stock indexes have lost nearly 30% since hitting record highs last month, with the benchmark S&P 500 off more than $8 trillion in value.

Analysts at S&P Global noted that over 7,500 trading days dating back to January 1990, five of the eight highest closing levels for CBOE’s volatility index <.VIX>, known as Wall Street’s fear gauge, occurred in the past week.

“Only the peaks in volatility that occurred during the 2008 financial crisis saw anything similar,” said Tim Edwards, managing director of index investment strategy at S&P Global.

“Over its long history, the S&P 500 has moved a little under 1% each day, on average. With VIX currently standing at four times its long-term average of 20, daily moves in the S&P 500 of around 4% are implied for the next month.”

(Reporting by Shreyashi Sanyal in Bengaluru, editing by Patrick Graham)