The escalating war in the Middle East jolted the stock market on Tuesday — a reaction that history suggests is common after a global shock, but often not lasting.

While the market rebounded Wednesday morning, the Standard & Poor’s 500 index, a broad measurement of how U.S. companies’ stocks are faring, closed Tuesday down 0.94%. The Dow Jones Industrial Average shed 0.83%, and the tech-laden Nasdaq Composite index lost 1.02%. However, earlier in the day, all three were down at least 2.5%. 

The drops early in the day were largely due to concerns about disruptions to global trade, including the flow of oil, until President Donald Trump’s announcement that the U.S. would facilitate ships getting through the Strait of Hormuz, a key maritime route.

History suggests the stock market’s volatility is par for the course.

The average one-week drop of the S&P after an initial geopolitical shock is 1.09%, according to a Stock Trader’s Almanac analysis of 17 incidents since 1939.

The biggest one-week gain was 13.51% after Germany invaded Poland on Sept. 1, 1939, which is generally considered the start of World War II. The largest one-week loss was 17.90%, when Germany invaded France on May 10, 1940. Over the next year after each incident, the S&P had posted losses of 5.55% and 20.87%, respectively, according to the analysis.

In more recent times, the S&P gained 3.27% in the first week after Russia invaded Ukraine on Feb. 24, 2022. After a year, though, the index was down 6.05%.

However, the economic backdrop was “much weaker” in the weeks and months after the invasion, said Jeffrey Hirsch, editor in chief of the Stock Trader’s Almanac. “The writing was on the wall that inflation was about to surge.

“This time around, the economy seems to be on much more stable footing,” Hirsch said.

However, “it’s still very early in this conflict,” Hirsch said. “So far, the market isn’t saying it will be drawn out. I think oil would be a lot higher.”

Oil prices surged after the U.S.-Israeli attack on Iran, but have since pulled back.

Historically, 12 months after a new crisis, the S&P posted an average gain of 2.92%, according to the Stock Trader’s Almanac analysis. The biggest jump one-year jump was 32.2% after the Gaza War began on Oct. 7, 2023. The largest loss was 34.30% a year after the Arab oil embargo that began Oct. 19, 1973. 

Where the market goes from here is impossible to predict. The CBOE Volatility Index, which measures expected volatility in the S&P over the next 30 days, stood at about 23 as of Tuesday. By comparison, in April 2025 when the market tanked due to new tariffs and uncertainty surrounding them, the index had spiked to 52.3.