The S&P 500 index's "wartime mode": rises at the start of the week, then trades sideways, begins to fall on Thursday and Friday.

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A five-week-long Middle East war that has impacted the global economy has caused U.S. stocks to develop a predictable pattern: strong opening at the beginning of the week, sideways trading in the middle, then almost “on schedule” declines every Thursday and Friday.

Similar trends have also appeared to varying degrees in European stock markets, emerging markets, and even some U.S. treasuries, but the effect is most pronounced in the S&P 500 index. Since the outbreak of the Iran war, the S&P 500 has climbed cumulatively during the first three trading days of each week, but plunged by about 9% combined on Thursdays and Fridays.

Optimism was especially evident at the start of this week, with the S&P 500 rising by more than 3%, as the market believed Trump intended to have the U.S. extricate itself from the conflict with Iran.

Analysts say the logic behind this is very simple: weekends mean two days, and this week, with Friday’s holiday market closure, it’s even three days where trading cannot happen. During this time, major changes in the war situation could occur, especially considering that President Trump tends to take significant actions while markets are closed. These changes could further impact the global economy. Therefore, many investors choose to reduce their stock positions before the weekend.

Joe Gilbert, a portfolio manager at Integrity Asset Management, said: “It’s unsettling to enter a trading blackout period while facing unpredictable risks. Compared to holding positions, reducing risk before the weekend has become easier.”

However, this “intraday/intraweek trading pattern” formed during wartime serves as a warning to investors who believe that selling has ended:

After this week’s rally, optimists believe the market has bottomed out. “Super bull” Tom Lee says U.S. stocks typically bottom out in the early stages of a war, and this round of adjustment is nearing its end. The S&P 500 usually bottoms out within the first 10% of the war’s duration; inflation-adjusted oil prices are below the average since the start of this century, so the impact on the U.S. economy is limited; coupled with extremely cautious market positioning at present, the current adjustment is already 90% to 95% complete.

Steve Sosnick, chief strategist at Interactive Brokers, says as the week progresses, optimism is usually replaced by risk-aversion sentiment.

Risk Warning and DisclaimerMarkets are risky, investment requires caution. This article does not constitute personal investment advice, nor does it take into account individual users’ specific investment goals, financial situations, or needs. Users should consider whether any opinions, views, or conclusions in this article are suitable for their particular circumstances. Investment based on this article is at your own risk. ```