Euro zone's volatility index drops to 7-month low

PARIS Feb 23 (Reuters) - The Euro STOXX 50 volatility index, Europe's main gauge of equity market investor anxiety, known as the VSTOXX index, dropped to a seven-month low on Thursday, signalling an improvement in investor risk appetite.

At 0832 GMT, the VSTOXX, which measures the cost of protecting against a decline in shares on the Euro STOXX 50 index, was down 2.6 percent at 23.38, a level not seen since before the market's nosedive in early August.

The lower the volatility index, based on sell- and buy-options on Euro STOXX 50 stocks, the higher investors' appetite for risky assets such as equities.