This icon only appears if the update is not solely game content. Types consist of: Game Content, Downloadable Content, Workshop Content, and Shader Pre-caching. Previously the progress bar would only display the downloading content progress but not the disk allocation process which would make an update to appear completed when it was not.
The downloads page in the Steam client has been replaced with a new implementation and has been visually redesigned for clarity and ease of use.
A new Steam client has been released and will be automatically downloaded.