The VIX volatility index, also known as the "fear index," dropped 4.54% Thursday amid easing trade tensions related to US tariffs.
President Donald Trump announced a trade deal with the UK, under which the US has agreed to reduce import taxes on a set number of British cars and allow some steel and aluminum into the country tariff-free.
Trump also signaled for a potential deal with China.
Responding to a reporter's question about whether he would lower tariffs on China if trade talks this weekend went well, he said "well, it could be."
The VIX index was at 22.48 at the market close in the US on Thursday, down from 23.5 on Wednesday.
The index saw historical high levels in April by exceeding 52.
Trump has decided to remove the 25% tariff on UK steel and aluminum while also reducing the tariff on most car exports from 27.5% to 10%.
The new car tariff applies to the first 100,000 vehicles exported from the UK to the US annually, with 101,000 vehicles having been exported last year.
Trump also stressed that the US is very close to making more trade deals.
Noting that US Treasury Secretary Scott Bessent will meet with Chinese officials in Switzerland, he said this is very important.
