Iran Attacks Israel. How Could Markets Be Impacted?

Executive summary:

  • The initial market reaction to Iran's attack on Israel was measured, with S&P 500 Index futures trading up 0.3%.
  • Historically, geopolitical events have generally led to modest selloffs in equity models and a flight to safety in bond markets, with long-lasting impacts atypical.
  • In the wake of Iran's attack on Israel, we believe that maintaining a slightly defensive posture across our portfolio strategies is appropriate.

Our investment leadership team convened twice on Sunday to discuss the conflict between Iran and Israel, its key watchpoints in the days ahead, and the pertinent risks onto markets, our investment portfolios, and our clients.

The team broadly agreed that maintaining a slightly defensive posture across portfolio strategies remained appropriate.