U.S. stocks have already recovered their losses from tensions in the Middle East that flared when a U.S. airstrike killed Iranian Gen. Qasem Soleimani last week. The same is largely true for crude oil, which has erased all of its gains since the incident, and a number of other risk assets.
What's happening: "Welcome to the brave new world where it appears that little short of full-fledged world war between nuclear-armed powers would be required to have a durable impact on financial markets. And even then, some begin to wonder," Reuters' Sujata Rao and Dhara Ranasinghe write.
The big picture: The quick turnaround, though, follows a general trend of resilience in financial markets in response to geopolitical crisis events.
- “Stocks could be volatile for a while, but the impact to stocks from geopolitical events historically has tended to be short-lived,” LPL Financial senior market strategist Ryan Detrick says in a note to clients.