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A closely watched stock-market 'fear gauge' on Wall Street is set for its sharpest weekly surge in over 6 months

Mark DeCambre

The Cboe Volatility Index extended a steady climb Friday as stocks tumbled, putting the gauge on track for its biggest weekly advance in six months. The so-called VIX is on pace to rise 39%, or 4.7 points, to 16.82. That represents its highest level since March, though it remains below the long-term average between 19 and 20. Wall Street's so-called "fear index" uses S&P 500 options to calculate expectations for volatility over the coming 30 days. A two-session jump in the VIX coincides with a slump in U.S. stocks over the same period. The Dow Jones Industrial Average has declined 0.2% so far this week, while the S&P 500 lost 1.1% thus far and The Nasdaq Composite Index is poised to decline 3.4%, which would represent its worst weekly fall in six months. The losses came as investors reacted to a recent surge in government bond yields, with the 10-year Treasury note yielding 3.24%, compared with 3.055% last week.