How Did Global Stock Markets React to the Outbreak and Ceasefire Announcements of the Iran-Israel-USA War?
Lakhotia, Ayan Manglam
Abstract
This paper aims to investigate the effect of instantaneous asset price effects for the four leading global equity indices, i.e., Nifty 50 (India), S&P 500 (US), FTSE 100 (UK) and Shanghai Composite (China) indices during the 2026 Iran-Israel-USA War, using the event study methodology. Using an event window of one day, the current research tries to uncover the asset price effects resulting from the announcements of the outbreak of war, intensification of the military action, and the ceasefires via the country level crude oil indices. It was found that there was asymmetry at the country level that resulted from the domestic reliance on energy and the composition of the sectors. The declared ceasefire on June 11 acted as the trigger of the market de-escalation mechanism, leading to coordinated relief rallies of all four indices. The market reaction to executive digital messages in real-time provides a good basis for testing the Semi-Strong Form of the Efficient Market Hypothesis in the presence of high geopolitical risks.
Cite (Chicago)
Lakhotia, Ayan Manglam. “How Did Global Stock Markets React to the Outbreak and Ceasefire Announcements of the Iran-Israel-USA War?.” Student Journal of Business and Economics (2026). https://doi.org/10.67521/sjbe.2026.019.