Stock markets usually fall before war breaks out, not afterwards
Professor Dr Bernd Meyer, Chief Investment Strategist & Head of Multi Asset
Berenberg Markets - Monitor, 28 February 2022
Stock markets usually fall before war breaks out, not afterwards
Source: Bloomberg, Time period: 02/02/1964 – 25/02/2022
If you look at past geopolitical conflicts, stock markets usually fell before war broke out. Immediately after the escalation, markets usually rose again.
This is because while markets have already priced in potential damage to society and the economy beforehand, there is increasingly more clarity about the effects after the outbreak of war.
In the following 2 to 6 months, the S&P 500 even recorded a positive return in every case of the conflicts shown here.