The World Is a Dumpster Fire. Why the Stock Market Doesn’t Care.
By Teresa Rivas
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Jan 14, 2026 4:48 pm EST
https://www.barrons.com/articles/stock-market-rally-iran-venezuela-fed-b5bfac0b
Key Points
\- The S&P 500 reached new records three times in the first seven trading days of 2026, with a 1.2% return year-to-date.
\- Despite geopolitical risks and tumultuous news, the stock market has remained calm, with investors not pricing in these uncertainties.
\- Strong economic indicators support the market’s current performance.
It might be an understatement to say 2026 has gotten off to a chaotic start. You would never know it by looking at the stock market.
The S&P 500 closed at new records three times in the first seven trading days of 2026, and isn’t far from its all-time high of 6977, with a 1.2% return for the year so far. Those gains belie a tumultuous news cycle and rising geopolitical risks.
“Don’t be alarmed that the stock market is about to fall off a cliff amid a fog of dizzying headlines,” writes Christopher Smart, managing partner of the investment strategy consultancy Arbroath Group. “But don’t assume that a rising S&P 500 index means that everything is fine.”
Stocks have shrugged off…practically everything in the first two weeks of the year. The U.S. capture of Venezuela’s president, President Donald Trump’s threats to invade Greenland, the growing risk of a U.S. military attack on Iran, and the increasingly urgent question of the Federal Reserve’s independence are all major headlines that happened before we even hit January’s midway point.
There are very real reasons to worry about each of those risks, along with other federal policy upheavals and their cumulative effects over time. Yet the stock market has historically had a hard time quantifying the consequences of these types of risk, which helps explain the rather blasé reaction to unprecedented events.
“Investors just don’t know how to price in geopolitical risks on any given day, so they don’t,” writes Smart. “But sooner or later the risk premium catches up with everyone.”
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