Stock Market 90–95% Done With War-Related Sell-Offs, Says Fundstrat’s Tom Lee – Here’s His Forecast

Fundstrat's Tom Lee believes that the stock market has largely completed its war-related sell-offs, with 90-95% of the impact already felt. In a recent interview on CNBC, Lee drew on historical precedent to forecast a strong April for investors. As March progressed, the Iran war situation appeared to be unfolding longer than initially anticipated, leading markets to adjust their expectations. However, Lee noted that while the "fog of war" remains uncertain due to the unknown end date, past data from seven major war events suggests that stock markets typically bottom out within the first 10% of a war's duration.

Lee used World War II as a key historical reference point. The war lasted nearly five years, and the stock market bottomed just five months into the conflict. This historical pattern, Lee argues, indicates that the significant adjustments in the market have already occurred. Despite the challenging start to 2026, Lee remains optimistic about the risk-reward environment for stocks, predicting that the S&P 500 will reach 7,700 by year-end.

Currently priced at 6,604.85, the S&P 500 has seen a 3.15% increase over the past five days but has dropped 3.82% year-to-date. As markets continue to navigate the geopolitical uncertainties, Lee's analysis offers a glimmer of hope for investors. While the situation remains volatile, the strategist's perspective suggests that the worst of the war-related sell-offs may be behind us, and opportunities for growth could be on the horizon.

Investors are advised to stay informed and cautious as they navigate this complex market landscape. While historical patterns can provide insights, each situation is unique, and the future remains uncertain. As always, due diligence and careful consideration are crucial before making any investment decisions. The stock market's ability to adapt and recover from adversity, as demonstrated by past events, may offer some reassurance to those weathering the storm.

In summary, Tom Lee's analysis of historical war-related market data suggests that the stock market has largely absorbed the impact of the Iran war. With the S&P 500 expected to reach 7,700 by year-end, investors may find themselves in a more favorable risk-reward environment. As markets continue to adjust, the lessons from history offer a cautiously optimistic outlook for the coming months.