Iran war’s aftermath: Are US stock markets shaking off their ‘Trump Always Chickens Out’ phase?
Certainly, it is possible that financial markets have now priced in some—maybe a lot—of the war’s economic damage, but we can’t know for sure. Looking at previous geopolitical risk events, the S&P 500 tends to bottom on average around eight days after the event. In other words, in a world of averages, the bottom may already be in by now. But averages can be tremendously deceptive and the actual outcomes of conflicts exhibit no clear pattern, from the rally after the Iraq War to the long grinding retreat after the start of the Gulf War. Every conflict is unique.
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