In ordinary times, the market is already a place where truth is hard to distinguish from falsehood. Over the long term, stock markets tend to trend upwards, but short-term fluctuations and their rhythm remain a mystery—even as podcast hosts and YouTube chart analysts consistently claim to see through it all. Wartime conditions complicate everything further. With the ripple effects of high oil prices, every piece of breaking news is enough to cause violent market swings and repeated back-and-forth movements. Market sentiment is extremely sensitive. Any new details released by the White House can trigger a shift in direction, although investors and analysts remain skeptical of President Trump's statements and the administration's projected timelines for conflict resolution. Even those outside financial circles are familiar with the "TACO trade" (an acronym for "Trump Always Caves Overall"): Trump often makes bold statements, only to repeatedly compromise and retreat afterwards. Although the term carries a slightly derogatory connotation, it has been adopted by Wall Street's non-partisan analysts as a trading framework. The market has already priced in this expectation, factoring the President's potential reversals into stock prices in advance. However, in the Iran conflict, Tehran also holds a voice. Perhaps the most peculiar aspect of the current environment is this: a key source of information influencing the market—Iran itself—is America's adversary. Navigational passage through the Strait requires cooperation from both sides, as does the reopening of the Strait of Hormuz. Thanks to social media, we can now read the other side's "official statements" directly, whether propaganda or fact, to gauge their willingness to cooperate. On Wednesday, the Iranian President even publicly issued an open letter to the American people, directly defending his government's position. Recently, Mohammad Bagher Ghalibaf, Speaker of the Iranian Parliament, has also entered the "stock market game," posting investment advice on X (formerly Twitter) and detailing Washington's various operations to guide market sentiment. This represents a new form of geopolitical information warfare combined with social media tactics, infused with the rhetoric style of financial influencers. "Taking statements out of context + deliberately manufactured Fear Of Missing Out (FOMO) = the basic formula for profiting from war. Please conduct independent research and make your own judgments," Ghalibaf posted on Wednesday. We noted earlier this week that NVIDIA CEO Jensen Huang may have lost the "magic" to single-handedly propel tech stocks higher. The reason, however, might be that the focus is too fragmented, split between the Iran conflict and new challenges from the Federal Reserve, leaving no one able to dominate market sentiment anymore. Investors also dare not place full confidence in any definitive conclusion about the direction of the situation. A more persistent shadow is the suspicion of insider trading related to predicting market moves, and the unusually precise crude oil trades that occurred just before Trump called off the attack on Iranian power plants. Optimism can be contagious, but the market has ample reasons to remain skeptical. Judging by the recent extreme sensitivity and jumpiness of the markets, skepticism has already become the mainstream view.
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