Volatility has sharply receded across asset classes, with the VIX closing at 16.4—its lowest since February—after a volatile June that saw repeated spikes above 21.5. The oil volatility index (OVX) mirrored this move, dropping from 74 to 40, while the MOVE Index fell to its lowest in over three years, reflecting a broad calming in both equity and fixed income markets. The S&P 500 gained modestly to 6,195 as volatility control funds increased systematic buying in the lower-vol regime.

Despite the overall calm, headline risk remains. The VIX briefly jumped 9% on July 7 following new tariff announcements by former President Trump, but quickly retreated below 18, suggesting the market is largely absorbing policy shocks. Treasury yields edged lower in June, with the 10-year drifting from 4.45% to 4.25% as expectations for Fed rate cuts firmed.

Geopolitical risk persists but has not materially impacted US markets. Russia’s record drone barrage on Kyiv, timed after a Trump-Putin call, and newly released audio of Trump threatening military action against Russia and China, highlight ongoing global tensions. For now, these developments have not translated into sustained market volatility.

In digital assets, the SEC’s review of the Cboe PENGU ETF—potentially the first to combine a memecoin and NFTs—drove a 30% rally in PENGU, underscoring continued speculative appetite in crypto. Meanwhile, increased call buying in Alphabet (GOOGL) points to investors seeking upside in mega-cap tech amid subdued volatility.

Traders should watch for any sustained VIX move above 18 or renewed volatility in Treasuries as early signals of regime change. Event-driven spikes remain possible given ongoing policy and geopolitical risks, even as the market environment remains broadly stable.