Thursday saw an increase in caution in the financial markets, with volatility surging by approximately 10% to levels not seen in six months. The CBOE Volatility Index, also known as the “fear index,” closed at 21.40, a level last observed on March 27, 2023. The escalation of the conflict between Israel and Gaza had a negative impact on global risk sentiment, while a U.S. Navy warship intercepted three missiles fired from Yemen. The U.S. State Department issued a travel warning for all Americans. Bond performance continued to underperform, with yields rising following mixed messages from Fed Chair Jerome Powell. Equity markets also experienced a significant drop, with gold acting as a safe haven.