Stock futures rose Monday because oil prices went up and apparently that means something now. Traders spent the weekend weighing U.S. attacks on Iran the same way they weigh everything else: by checking if the line went up or down and then pretending they understood why.
Wall Street just finished a mixed week. Mixed means some people made money and other people lost money, which describes every single week in market history, but financial journalists need to fill space between car commercials.
The mixed week featured a rotation out of tech and into other parts of the stock market. Rotation is what we call it when the stocks you own go down while different stocks go up. It sounds better than saying you picked wrong.
Tech stocks fell because they had gone up too much. Other stocks rose because they hadn't gone up enough. This passes for analysis on channels that broadcast 18 hours a day.
The U.S. bombed Iranian targets over the weekend. Oil prices jumped. Futures followed. Every retail trader who stayed up until midnight Sunday refreshing their brokerage app now believes they understand geopolitics.
They don't.
Oil rises when supply looks threatened. Stocks rise when literally anything happens because the market has spent fifteen years forgetting how to go down. Both things happened at once and now some guy in Minnesota with $4,000 in a Robinhood account thinks he called it.
The correlation between what happens in the world and what happens to your portfolio is roughly the same as the correlation between earthquake activity and ice cream sales. Sometimes the lines move together. That doesn't mean the earth is mad about dessert.
Futures measure what people are willing to pay right now for the privilege of owning stocks later. They're essentially a bet on a bet. The fact that we treat them as breaking news says everything about how seriously you should take any of this.
Photo by Martin Sanchez on Unsplash
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