Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Investors Want Osama, Not Saddam

NEW YORK -- The capture of former Iraqi leader Saddam Hussein gave an initial boost to stock markets worldwide on Monday, leading some analysts to believe that a bigger rally would occur if the United States reels in Osama bin Laden, the suspected mastermind of the Sept. 11, 2001, attacks.

Market players said capturing the elusive al-Qaida leader would give stock markets a significant boost, at least in the short term, since bin Laden is seen as having a more direct link to global terrorism than Hussein.

"Osama bin Laden has a more direct impact on the global war on terror, so the impact [from his capture] would be larger than what we're seeing after Hussein's capture," said Peter Gottlieb, president of Gottlieb Investment Management Corp. in Chicago.

News that U.S. troops had captured the former Iraqi dictator over the weekend sparked early rallies in stock markets from Tokyo to London and New York on Monday, only to peter out by the close of trade in some locales.

"I'm somewhat surprised the gains aren't bigger, but the feeling is that major military operations were already completed and Hussein's capture was inevitable," Gottlieb said. "It also won't affect the outcome of the U.S. presence in Iraq."

On Wall Street, the three major U.S. stock indexes finished lower, erasing earlier gains, as investors digested news of Hussein's capture.

But Japan's benchmark Nikkei average surged more than 3 percent, while Britain's FTSE 100 ended nearly unchanged after rallying earlier in the session.

Unlike Hussein -- who did not appear to be in charge of leading Iraqi resistance when he was caught hiding in a hole at an isolated farm -- bin Laden appears to be more firmly in control and capable of mobilizing members of al-Qaida, the militant group behind the attacks on the World Trade Center and the Pentagon, market analysts said.

Since the Sept. 11 attacks, al-Qaida has also been linked to roughly a dozen bombings in Kenya, Indonesia, Saudi Arabia, Morocco and Turkey.

"There's a slight benefit to Saddam being captured, but bin Laden is a bigger thorn in the side of the U.S. because he's directly linked to Sept. 11 and other known terrorist activities," said Tim Ghriskey, president of investment firm Ghriskey Capital Partners in Bedford Hills, New York.

"Osama clearly has a more loyal network of followers and is more closely tied to global terrorism," Ghriskey said. "Therefore, the capture of him or proof of his death would be more psychologically positive for the stock market."

Several times this year, the airing of video or audio tape allegedly of bin Laden was enough to reignite jitters about terrorism and cause U.S. stocks to fall.

Conversely, rumors about bin Laden's capture or demise have routinely swept across Wall Street and sparked short-lived market rallies, until the rumors were all discredited.

Given the market's sensitivity to any rumor or scrap of information about bin Laden and the deadly nature of incidents linked to al-Qaida, capturing bin Laden would deliver a significant boost for consumer sentiment and investor confidence, Ghriskey said.