US Stocks Vulnerable as Midterms Approach

US stocks remain near record highs despite looming midterm elections and warnings of market fragility. Analysts note that low volatility and complacency leave investors unprepared for potential shocks.

FILE PHOTO: A street sign for Wall Street is seen outside the New York Stock Exchange (NYSE) in New York City, New York, U.S., July 19, 2021.

The United States stock market sits near record highs while the VIX hovers near 15, reflecting deep investor complacency ahead of the November midterms. This rare calm clashes with warning signs of extreme market fragility and low equity correlations. Investors risk severe exposure if an unexpected shock pierces the current market invulnerability.

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