While Middle East is witnessing its worst conflict in decades after the Hamas attack on Israel, global markets may face negligible impact, at least going by historical trends. Long-term data suggests even the Israeli markets are resilient.
Israel's TA-35 index has fallen 5.33% since the latest war between Israel and Hamas broke out after an audacious attack by the militant organisation. Indian and U.S. market indices—Nifty 50 and Dow Jones—have been steady even as Brent crude rose since the war began. The U.S. dollar has weakened 0.33%.
After Israel declared war against Gaza-based Hamas on Oct. 8, questions arose on its impact on the market and global trade, given that Middle East is a key oil supplier to the world.
Yet, TA-35 has defied past violence. Over two decades, the Tel Aviv benchmark has ultimately risen during each of the six major flareups since 2000.
Other global markets too have fared well. But their performance is not comparable since prevailing conditions like the dot.com bust of 2000 and the 2008 Lehman Brothers collapse would have had a bigger impact.
Crude oil gained during three of the six periods, with marginal losses during one. However, it fell during the last two periods of conflict—the Gaza war during 2014, and the Israel-Palestine crisis of 2021. The commodity prices fell 5.9% and 2.4%, respectively.
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