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Veteran investor Porinju Veliyath has a clear message for investors amid rising geopolitical tensions: “The war will end.” At a time when markets are gripped by uncertainty and fear, his statement underscores a broader perspective on staying calm and focused on the long-term.

In a tweet, he posted a table showing that data points to average 6-month gains above 17% after a geopolitical crisis.

"As it can be observed, worst gets over in first few weeks and in medium to long term almost always they end up becoming great buying opportunities - albeit in hindsight!.

According to the data curated by the EQ research team, past global crises show a consistent pattern—sharp short-term declines followed by meaningful gains over the medium to long term.

The dataset tracks major global events—from the USSR invasion of Afghanistan (1979) to the COVID-19 market crash (2020)—and their impact on the Sensex. In the immediate aftermath, markets often reacted negatively. For instance, the September 11 attacks saw the Sensex fall 17.47%, while the Lehman Brothers collapse triggered a steep 29.22% decline, and the COVID-19 crash led to a massive 36.89% drop.

Even geopolitical conflicts like the Gulf War ultimatum and US bombings in Libya resulted in short-term volatility, with mixed immediate reactions ranging from -2.92% to -2.51%. However, not all events led to declines—episodes like the Iraq invasion of Kuwait saw a sharp 74.62% rise during the reaction period, highlighting how market responses can vary widely.

Despite this volatility, the recovery trend is striking. On average, the Sensex delivered 10.34% returns in 3 months, 17.35% in 6 months, and 25.91% in 9 months after such events.

Some recoveries were particularly strong. For example, after the Lehman collapse, the Sensex gained 57.72% in 6 months and 68.65% in 9 months, while post-COVID recovery stood at 33.68% in 3 months, 49.51% in 6 months, and 80.75% in 9 months. The GFC peak fear phase also saw gains of 80.27% (3 months), 85.78% (6 months), and 106.57% (9 months).

Even earlier events followed similar patterns. The Gulf War ultimatum saw 25.28% gains in 3 months and 73.38% in 9 months, while the Gorbachev coup delivered 32.74% returns in 6 months and 93.98% in 9 months. On the other hand, some events like the Japanese tsunami and Asian crisis showed weaker or negative medium-term returns, indicating variability across crises.

The key takeaway is that while geopolitical shocks create immediate uncertainty and downside risk, the worst of the market reaction typically plays out within the first few weeks. Over the medium to long term, equities have historically rebounded, often turning periods of panic into attractive buying opportunities.

However, the analysis also cautions that averages do not guarantee outcomes but do highlight a recurring pattern—markets may fall fast during crises, but they also tend to recover faster than expected.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.Pranati Deva is a seasoned financial journalist with over a decade of experience in high-pressure newsroom environments, currently working as a Senior Sub Editor at LiveMint. Over the years, she has developed a reputation for sharp editorial judgement, a strong grasp of market dynamics, and the ability to translate complex financial developments into clear, engaging stories for a wide audience.

Her core areas of coverage include stock markets, leading listed companies, currencies, and commodities, with a particular strength in fast-paced, real-time market reporting. She is known for handling breaking market news, earnings-driven stock movements, and macroeconomic developments with speed, accuracy, and context—qualities that are essential in financial journalism.

Pranati has built a diverse and credible professional track record across some of India’s most respected news organisations, including MintGenie, CNBC-TV18, Business Standard and EconomicTimes.com. During her stints at these platforms, she produced data-driven market stories, curated and steered live blogs during volatile trading sessions, and conducted interviews with market veterans, fund managers, economists, and industry experts. Her work often combines on-ground reporting with analytical depth, helping readers make sense of daily market fluctuations and longer-term trends.

An alumnus of the Symbiosis Institute of Media and Communications and Hansraj College, University of Delhi, Pranati brings a strong academic foundation to her journalism. She specialises in real-time financial reporting, with a keen focus on precision, balance, and insight, aiming to decode market movements in a way that is both informative and accessible to readers across experience levels.

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