Fear index shoots up 24 per cent as investors rush for safe-haven assets

Heightened instability in the Middle East drove up the Chicago Board Options Exchange (CBOE) volatility index yesterday, as investors scrambled for less risky assets to ride out the turmoil.

As a result, stocks suffered their biggest one-day loss in nearly six months.

The Vix – often dubbed the fear index or the fear gauge measure – attempts to measure the volatility of S&P 500 stocks over a 30-day period. It settled up 24.1 per cent at 20.04. The percentage gain was the largest since 20 May last year.

US treasuries prices and the dollar – assets considered safe compared to stocks – rallied as a result.

Thomas Nyheim, portfolio manager for Christiana Bank & Trust said: “The market hates uncertainties, especially geopolitical ones, and based on how that shapes up throughout the weekend, next week’s trading will be impacted”.

Crude futures rose 4.4 per cent to $89.43 (£55.78) a barrel as the protests in Egypt threatened Middle East stability.