Stocks Often Shrug at Geopolitical Conflict. Israel-Hamas War Is No Different.

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French asset manager Amundi looked into two dozen international crises that have occurred in the past eight decades.

The stock market’s reaction to the war between Israel and Hamas has been fairly muted so far, and if history is any guide, it could continue to shrug off the conflict.

The stock market had a relatively mild reaction, as well, after Russia’s invasion of Ukraine in 2022. Although shares tumbled in the days leading up to the attack, when the invasion happened the S&P 500 stayed relatively flat and ended 7% higher about one month later. French asset manager Amundi looked into two dozen international crises that have occurred in the past eight decades—from Pearl Harbor to the second Iraq war. The list also included crises that weren’t geopolitical conflicts, including the Covid-19 pandemic and the collapse of Bear Stearns.

Six months after the Pearl Harbor attack, the Dow Jones Industrial Average was 10% lower. For the other two cases, the index was down 3.2% and 1%, respectively, a half year after the events, according to Amundi.

 

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