U.S. Stock Market Fear Index Plummets to 31.3, Concerns Over September Effect

The fear index of the U.S. stock market has reached 31.3, the highest level in the past two months, entering the 'fear' zone. This is attributed to a combination of geopolitical tensions in the Middle East, rising U.S. Treasury yields, and inflation concerns. On the 2nd, CNN Business's Fear & Greed Index plummeted from 47.4 the previous day. The Dow Jones, S&P 500, and Nasdaq indices all showed a downward trend. September is historically a period when the 'September Effect' negatively impacts the U.S. stock market, with the S&P 500 index recording an average loss of 1%. Recent geopolitical tensions in the Middle East and news of renewed clashes between the U.S. and Iran have driven oil prices up and heightened inflation fears. The yield on the 10-year U.S. Treasury bond remains high at 4.78%, and the likelihood of a Federal Reserve interest rate hike has increased to 60%. According to an AAII survey, the proportion of bears has exceeded the historical average at 44.4%. The CBOE Volatility Index (VIX) recorded 16.16, reflecting market volatility. Oppenheimer analyzed that the current technical position of the market could reduce the risk of a large-scale sell-off, but warned that geopolitical uncertainties and the U.S. midterm elections could exacerbate market risks.

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