The International Monetary Fund (IMF) indicated that increasing geopolitical risks could lead to significant declines in stock prices. During the spring meetings starting on April 21st, the IMF shared a section of the Global Financial Stability Report to be published, warning that the fluctuations caused by rising geopolitical risks could jeopardize the stability of financial markets. While not explicitly mentioning specific actions like the additional tariffs announced by U.S. President Donald Trump in recent weeks, the IMF pointed out that conflicts, wars, terrorist attacks, military expenditures, and trade restrictions have led to a sharp increase in risk measurements based on news since 2022. According to the report, events such as wars, incidents causing diplomatic tension, or terrorism have reduced stock prices by an average of 1% per month across all countries, with developing markets experiencing an average decline of 2.5%. Conflicts like Russia’s invasion of Ukraine in 2022 were highlighted as significant risk factors, leading to a monthly average drop of 5% in stock returns. Compared to other geopolitical risks, conflicts resulted in a twofold decrease in stock returns. Moreover, the IMF stated that economic uncertainty has increased tail risks in investment portfolios, characterized by extreme and unexpected losses, raising the risk of a stock market crash.