Hi {{contact.first_name}},
There’s been a lot of noise in the markets recently: war headlines, oil price concerns, and political uncertainty.
But when we look beyond the headlines, the actual data and market behaviour tell a clearer story.
1) Markets are not moving because of the war
The recent dip in markets actually started before the Iran conflict largely driven by an AI-related selloff, not geopolitics.
Since then, markets have recovered strongly even as the war continues, which tells us something important:
👉 Investors are focusing on fundamentals, not headlines.
2) Corporate earnings remain very strong
US companies grew earnings by about 19% year-on-year, with expectations of ~24% growth ahead.
This level of growth is typically only seen during strong economic periods — not during crises.
Interesting read: Investors return to US stocks as AI, earnings growth feed fear of missing out
3) It’s not just tech — the economy is holding up broadly
While companies like Nvidia are leading the AI boom, growth is still healthy across sectors.
- Financials and materials sectors are seeing strong profit growth
- Even companies like PepsiCo and Johnson & Johnson continue to deliver solid results
👉 This suggests underlying economic resilience.
4) Oil shocks are less impactful today
Unlike past Middle East conflicts:
- The global economy is less dependent on oil
- Price increases have been moderate vs past crises
- Inflation expectations remain stable
Interesting read: Oil Shocks Don't Bite Like They Used To
👉 Markets are not pricing in a major disruption.
5) The real driver: earnings and AI growth
A small group of AI-related companies is expected to drive a large portion of market growth in the coming year.
👉 This is what’s moving markets today, not geopolitics.
6) Risks are still worth watching
Of course, uncertainties remain:
- If the conflict escalates beyond the region
- If energy prices rise sharply
- Or if policy uncertainty increases
These could affect markets but they are not the base case for now.
Bottom line
👉 Markets may feel volatile day-to-day, but they are being driven by earnings strength and long-term growth trends
👉 As long as the conflict remains contained, its impact on markets is likely limited
If anything, periods like this are a good reminder:
Are we reacting to headlines…
Or positioning based on what actually drives long-term returns?
If you would like, we can take a few minutes to review how your portfolio is positioned and whether it’s structured to handle both uncertainty and opportunity ahead.
Best Regards,
Zest
Executive Wealth Consultant | Associate Estate Planning Practitioner |
Licensed General Insurance Advisory
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