A popular measure of volatility on Wall Street jumped more than 30% on Tuesday as stock-index benchmarks saw one of their worst daily declines since mid August. The CBOE Volatility Index surged 34% Tuesday afternoon to 13.61, marking its biggest one-day rise since Aug. 10. Known as the fear gauge, the indicator is a measure of options bets on the S&P 500 index 30 days in the future and tends to be used as a sign of increased anxiety in the market because stocks fall faster than they rise. The jump in the gauge, which is still holding below its historic average of 20, comes as the Dow Jones Industrial Average is down 272 points, or 1.2%, the S&P 500 index is off 1.2% and the Nasdaq Composite Index is looking at a 1.6% tumble. A defiant North Korea, which warned at an unspecified counteroffensive strike as the U.S. attempts to impose sanctions on the Hermit Kingdom after it tested a hydrogen bomb over the weekend has been cited as among the reasons for the market’s recent downdraft after the Labor Day holiday. Concerns about President Donald Trump’s ability to enact pro-growth legislation also has helped to rattle markets that had been rising on the back of business friendly policies coming to fruition soon.
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