Calm has been restored in most financial markets, with the VIX falling to its lowest level in more than a year and the S&P 500 posting a record high, show data from S&P Dow Jones Indices.
The VIX closed at 11.77 on Thursday, and nearly every volatility measure has lowered since the U.K.'s vote to leave the European Union on June 23. The greatest falls were in short-term U.S. equity volatility and British pound sterling volatility, both down by around 50%.
The only exception was the Japanese yen, which closed at 17.46 on Thursday — its second highest level this year — due to market uncertainty over a possible stimulus package by the Bank of Japan.
The S&P 500 also posted a record high, reaching 2,173 on Thursday.
“At the start of the holiday season, the global outlook is generally suggestive of a quiet summer,” said Tim Edwards, senior director of index investment strategy at S&P Dow Jones Indices, in a statement accompanying the data.
However, S&P DJI noted increasing correlations between U.S. equities and bonds, and between U.S. and European equities as potential grounds for concern. The data provider said this is evidence that the markets are following macroeconomic events rather than fundamental drivers, leaving markets potentially more fragile to further shocks from a tense political climate.
Jack Lejk contributed to this story.