Stock futures slipped after the U.S. and Iran exchanged airstrikes. Traders absorbed this information by staring at squiggly lines and pretending the lines know something about geopolitical conflict.
The relationship between missiles and Microsoft's quarterly guidance remains unclear. No one has explained how Tehran's military strategy affects whether people will buy more iPhones this quarter. The connection does not exist. Retail traders believe it does anyway.
Futures dropped 0.3%. A rounding error with better PR. The S&P 500 moved less than the cost of a Chipotle burrito but CNBC needed a reason so they pointed at Iran. Could have been anything. Could have been a pigeon landing on the NYSE steps. The market was going to move regardless.
Earnings reports loom later this week. Companies will announce how much money they made selling software and hamburgers. Traders will ignore those numbers and focus instead on whether a CFO said the word "cautiously" during a conference call. This is called analysis.
The Middle East has been exchanging airstrikes for seventy years. Futures have gone up during conflicts. Futures have gone down during conflicts. Futures have done nothing during conflicts. The pattern is that there is no pattern but retail traders refresh their portfolios anyway, convinced this time the correlation is real.
Some guy in Wisconsin just sold his Tesla shares because of Iranian missile doctrine. He does not know where Iran is on a map. He cannot spell Tehran. He definitely cannot explain how this impacts Elon's delivery numbers but he clicked sell with the confidence of someone who watches a lot of YouTube.
The market will open. Numbers will move. Talking heads will credit the movement to Iran or earnings or Jupiter's alignment. None of it matters. The lines go up and down because that is what lines do when millions of idiots click buttons at the same time.
Photo by Saifee Art on Unsplash
Leave a Comment