I want to know how stock market reacts when actual war breaks out and their approximate duration. I have no trading experience about it, but would like to know from who were actually in the market during war or from well read/heard person on this kind of event. I saw market falling in the wallstreet following 911 event. It fell sharply for about a week or so but bounced back sharply for several weeks. So far I recall market moved further when US coalition force began bombing Taleban/AlQueda evils in Afganistan. But, that was for terrorist attack event. Market has been currently discounting for war with Iraq. The same thing happened when tension between India and Pakistan was about to climax. The market fear was for possible nuclear war between these rivalaries. I am wondering when actual war is declared or when US planes begin bombing Iraq, what will happen to stock market? Will it bounce up on the day war breaks out? If it falls further, how long will it fall? What had happened during 1990s Gulf war? What happened when war was declared and what happened when UN forces begin bombing Iraq? And, for how long? How dollar, gold, bond move? Relevant information/link if anyone knows would be useful for those interested in the current situation. Thanks.
Me! War time markets are good! I'm probably the only person in ET who hand-wrote 113 years of Dow Index in a Daily Bar Chart. 62 years of Soybean, Daily Bar Chart. ... war markets are nice because the market doesn't move logically. Meaning... it move under human or social emotions. Usually, when the market is calm or under peaceful terms, the larger economic trend cycles are a dominant force. But during the war, the cycles of human emotions get extra strong. In, another words, cycles under 3 months, become a dominant force. That's the overview or war markets. Sorry for a Gannish... Cycle Analytic responce. One more thing is the flunctuation of prices tend to increase. Historically, the volatility of the market starts chopping up and down between regular slope of price trends. I guess it should be a good short-term (swing) trader market. I haven't had the change to go through intraday moves... Well, just my 2 cents.
Center for Research in Security Prices (CRSP) database run out of the University of Chicago might be a good source. Any decent business school has CRSP database and they will let you use it if you ask them nicely. If I don't forget, have time, and you still haven't found it, I may download it for ya on Monday when I get to work.
Thanks. I found the crsp website but downloading required subscribsion of service. If you can do a favor me please have it download for dow and sp500 indices. thanks