Investing.com -- The Cboe Volatility Index fell sharply on Wednesday after President Donald Trump agreed to a temporary ceasefire in the war against Iran.

The index, known as the VIX, dropped over 5.8 points to 20.13, reaching its lowest level since February 27, before the US began its attacks. If the decline holds, it would represent the largest one-day drop since Trump paused his tariff rollout a year ago, which had triggered disruption in global markets.

Trump's decision to step back from his threat on Tuesday to escalate the war prompted a broader market response. Stock futures advanced, bond yields declined, and oil prices fell.