India VIX Falls 1.35% to 13.18 as Easing Global Risks and Lower Oil Prices Keep Market Volatility Near Three-Month Lows

Mumbai, June 17: India VIX, the volatility gauge widely tracked as the market’s fear index, extended its downward trajectory on Wednesday, closing at 13.18, down 0.18 points or 1.35% from the previous close of 13.36. The decline comes amid easing geopolitical tensions in West Asia, falling crude oil prices and improving stability across domestic equity markets. The index remained near its lowest levels in almost three months, signalling a sustained cooling in short-term market volatility expectations. 

India VIX traded within a broad intraday range, touching a high of 13.53 and a low of 12.35, while remaining significantly below its recent peak levels witnessed earlier this month. The index currently stands well below its 52-week high of 28.90 and above its 52-week low of 8.72. 

India VIX Closes at 13.18 After Sliding from 13.53 to 12.35 Intraday 

The volatility index opened at 13.36, unchanged from the previous close, before witnessing selling pressure through the session. It touched an intraday low of 12.35 and later recovered modestly before settling at 13.18. 

The latest decline follows a sharp fall of nearly 6.9% recorded during the previous trading session, when the index dropped to 13.36 from around 14.35. During Wednesday’s session, India VIX remained largely range-bound despite minor fluctuations, indicating reduced uncertainty across the broader market. 

Also Read: Understanding India VIX: What 15 vs 25 Means for Your Portfolio Risk in Plain Language 

Technical indicators reflected a neutral trend, with the daily technical rating remaining unchanged. Key pivot levels for the day stood at 13.57 as the central pivot point, while immediate support levels were placed at 12.80, 12.23 and 11.46, and resistance levels were seen at 14.14, 14.91 and 15.48. 

US-Iran Peace Progress and Oil Retreat Drive Volatility Lower 

The primary factor behind the continued decline in India VIX was the easing of geopolitical concerns surrounding the Middle East. 

Market participants tracked developments related to ongoing discussions between the United States and Iran, with reports indicating growing optimism around a potential peace framework agreement expected later this week. Expectations surrounding the reopening of the Strait of Hormuz, a critical global energy shipping route, contributed to a sharp reduction in fears of supply disruptions. 

The easing of these concerns coincided with a decline in international crude oil prices. Lower energy prices reduced immediate worries regarding imported inflation and external economic pressures, contributing to a calmer market environment and a decline in volatility expectations. 

The combination of geopolitical stability and softer crude prices helped reverse the volatility spike that had pushed India VIX above 17 earlier this month amid concerns over regional tensions and global market uncertainty. 

Sensex Above 77,050 and Nifty Reclaims 24,000 As Fear Gauge Cools 

The decline in India VIX occurred alongside continued strength in domestic benchmark indices. 

Indian equities extended gains for a fourth consecutive trading session, with the Sensex rising by more than 250 points to trade above 77,050, while the Nifty 50 advanced by approximately 55 points to reclaim the 24,000 mark. 

The moderation in volatility coincided with broader stability across financial markets, reflecting a significant shift from the uncertainty that had dominated sentiment earlier in the month. Lower volatility readings generally indicate expectations of more measured market movements over the coming weeks. 

The positive trend also supported the overall valuation of listed Indian companies, with the total market capitalisation of domestic equities crossing the $5 trillion mark once again during the session. 

India VIX Stays Near Lower End of Normal 13–17 Zone 

Despite the recent decline, India VIX continues to remain within the range that market participants typically classify as normal. 

According to commonly tracked volatility bands, readings below 13 are generally associated with calm market conditions, while levels between 13 and 17 indicate normal volatility. A move between 17 and 25 is often linked to rising uncertainty, while levels above 25 are viewed as reflecting elevated market stress. 

At 13.18, the index is positioned close to the lower end of the normal range, highlighting a substantial moderation from the heightened volatility witnessed during recent geopolitical developments. 

The current reading also represents a significant distance from the 52-week high of 28.90, underscoring the sharp easing in risk perception over recent weeks. 

June History Shows Average Monthly Decline Of 7.44% 

Historical data indicates that June has frequently been a weak month for India VIX. 

Seasonality analysis shows that the volatility index has delivered negative returns in 11 out of the past 18 years during June. The average change for the month stands at -7.44%. 

The largest positive June movement was 9.45% recorded in 2011, while the largest decline was 43.90% registered in 2024. On average, positive June performances have produced gains of 5.58%, whereas negative June periods have resulted in average declines of 15.72%. 

The latest fall in India VIX adds to this historical pattern, with the index continuing to trend lower through the month amid improving external conditions. 

Monsoon Deficit and Fed Decision Remain Key Watchpoints 

While volatility has eased considerably, several developments continue to remain in focus for market participants. 

The progress of the Southwest Monsoon is being closely monitored after rainfall activity slowed following its arrival in Kerala. Data available as of 16 June indicated a rainfall deficit of approximately 35% across the country, keeping attention on agricultural output and inflation-related developments. 

Global monetary policy is also under scrutiny as investors await the first policy decision from the US Federal Reserve under Chairman Kevin Warsh. Market participants continue to track international policy signals for their potential influence on global financial conditions. 

These factors remain important variables even as India VIX trades near multi-month lows. 

India VIX closed at 13.18, down 1.35%, extending its decline after a sharp fall in the previous session and remaining near a three-month low. Easing Middle East tensions, lower crude oil prices and stronger domestic equity benchmarks contributed to reduced market volatility, while monsoon progress and upcoming US Federal Reserve decisions continue to remain important developments to watch. 

Source 

• https://www.nseindia.com/reports-indices-historical-vix