Wall Street’s equities volatility gauge climbed on Thursday to its highest level since the end of January.

The CBOE’s Vix index, which tracks options trades to determine investor expectations for S&P 500 volatility over the next month, climbed as much as 0.85 points to 12.82.

The gauge has risen even as the S&P 500 has pushed to new heights this week, reflecting a slight uptick in hedging activity as traders pay close attention to political news out of Washington. The Trump administration has said it will unveil some of its business tax reform plans over the next few weeks — which may include a proposal to cut the US corporate tax rate.

While the Vix has ticked up, it still remains at historically low levels, according to Dennis DeBusschere, head of portfolio strategist at Evercore ISI. Indeed, the average since 1990 is 19.64, according to Bloomberg data.

“Investors have shown few signs of giving up on being long stocks and short volatility,” said Mr DeBusschere.

Still, strategists at Bank of America Merrill Lynch warned this week that “potential delays and uncertainty about the ultimate effect of the policy changes (that are expected from the Trump administration) could set markets back, at least temporarily”.

In mid-day trading, the S&P 500 was down 0.4 per cent to 2,340.7, receding modestly after striking a new all-time high earlier on Thursday.

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