PANews, August 17: According to CNBC, despite the S&P 500's significant rally this year and continued inflows of capital, historical seasonal selling pressure, ongoing geopolitical tensions, and emerging signs of consumer weakness are prompting Wall Street strategists to issue a wave of risk-aversion warnings. Wall Street institutions generally view mid-August to mid-October as a historically volatile period for markets. According to BTIG’s statistical model, in every midterm election year since 1990, the equal-weighted S&P 500 index has experienced at least a 7% pullback from its average peak on August 18 to mid-October. The CBOE Volatility Index (VIX) dropped sharply last Friday to 14.2, reaching its lowest level since 2026.
Wall Street Warns of Market Correction Amid Low Volatility and Geopolitical Tensions
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Summary
Wall Street is raising alarms over a potential market correction as the Fear & Greed Index shows signs of imbalance. Despite strong S&P 500 gains and capital inflows, seasonal selling pressure, geopolitical risks, and weakening consumer demand are fueling concerns. Historically, midterm years since 1990 have seen at least a 7% correction in the equal-weighted S&P 500 between August and October. The VIX reached 14.2 last week, the lowest level since 2026.
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