Dow Dips Around 500 Points, Market Volatility Increases Further

US stocks recorded sharp losses on Monday as investors were concerned that China's strict Covid-19 policies would negatively impact economic growth around the world.

Investors were also assessing comments from Federal Reserve officials to get some insights on future rate hikes. Majority of the traders are now expecting the central bank to raise interest rates by 50 basis points during its December meeting.

All the major sectors on the S&P 500 closed on a negative note, with real estate and energy stocks recording the biggest plunge on Monday.

The Nasdaq 100 dipped 1.43% to close at 11,587.75 on Monday, amid a drop in shares of Apple Inc and Microsoft Corp MSFT. The S&P 500 dropped 1.54%, while the Dow Jones tumbled around 498 points to settle at 33,849.46 in the previous session.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) climbed 8.3% to 22.21 points.

What is CBOE Volatility Index?

The CBOE Volatility Index, popularly known as VIX, is a measure of the equity market's expectation of volatility based on S&P 500 index call and put options.