By Michael Msika, Bloomberg Markets Live reporter and strategist
Investors are back in risk-on mode with indicators improving across the board, yet the volatility episode did leave behind some scar tissue.
Most of the losses sustained at the start of August have already been recouped, with dip-buyers in full throttle. Exacerbated by technical factors and low liquidity, the whirlwind seems to have stopped with credit spreads barely waking up, especially in Europe. Still, some skepticism remains. UBS strategists note that the VIX Index — the key measure of expected volatility in stocks — has achieved two records over the last week: The fastest 25+ point spike from lows, and the fastest ever retracement from that spike.
