It's not the news that matters, it's how the market reacts to the news that matters.

That old Wall Street saw comes to mind Friday morning after U.S. stock futures produced a stunning turnaround from overnight losses tied to geopolitical news that roiled global markets.

After S&P 500 futures traded as low as 1890 in pre-open trading, the index was recently up 0.4% at 1916 despite reports that U.S. Navy jets bombed ISIS artillery in Northern Iraq. Rumors of such strikes were attributed with prompting Thursday's selloff and President Obama's formal authorization announcement was cited in causing the overnight selloff in futures and global markets.

As my colleuage Michael Santoil notes, traders view the U.S. bombing of ISIS as marginally bullish for stocks because it's net bearish for oil, which jumped overnight after Obama authorized the strikes. By attacking ISIS now, the hope is the jihadist group can be stopped before it threatens Iraq's oilfields in the south -- or so the thinking goes.

Related: 'Bull markets don’t die of old age': Time to start buying

It's a long way to go to the close and major averages started the day more than 4% below recent all-time highs, with the Dow down 9 of the past 12 sessions and on track for its first 3-week losing streak in a year. And there's been a "stealth" correction under the surface, with the Russell 2000 down nearly 8% from recent highs and the S&P Utility index off 8.4% since June. But big-cap U.S. stocks overall have proven stubbornly resistant to various excuses to go down, be they geopolitics (Ukraine, Iraq, Gaza, South China Sea) or the unraveling of some big deals (Sprint-T-Mobile, 20th Century Fox-Time Warner).

That said, there's evidence of rising fear in global markets:

• U.S. 10-year Treasury yields are at their lowest levels since June 2013.

• Gold is at a three-week high.

• German 10-year yields hit their lowest level on record at 1.023% overnight while 2-year yields went negative, meaning investors in those securities are effectively paying the German government to hold their money for them.

• Junk bonds suffered record outflows of $7.1 billion for the week ended Aug. 6, according to Lipper, the fourth consecutive week of outflows.

• U.S. equity funds were hit with $16.4 billion in outflows for the week ended Aug. 6, the most since early February.

The last item is evidence of retail investors' nervousness about the market which is a positive thing from a contrarian standpoint. Similarly, the number of bears in the American Association of Individual Investors jumped to 38%, the most since Aug '13.

Related: Slow grind with low volatility the market’s new normal

Despite all the recent talk about the stock market being in a "bubble," there's an awful lot of negativity and anxiety about stocks, which is not what bubbles are made of.

Less philosophically, the question now seems to be whether the U.S. stock market has become a safe-haven of sorts, or is a lagging indicator about to suffer its big comeuppance, as Lauren Lyster and I discuss in the accompanying video.

In the latter category, there's plenty of forecasts for the market's unraveling, many based on the cyclically adjusted-PE ratio which has reached levels previously seen before major tops in 1929, 1999 and 2007.

In the former category, the U.S. increasingly looks like an island of stability in a troubled world and our economy, for all its flaws, appears to be on the upswing -- in stark contrast to Europe's, which is directly impacted by the Russia-Ukraine tensions. Furthermore, stock valuations don't look so stretched when compared with uber-low Treasury rates, especially considering the strength of corporate balance sheets and profit margins.

At this point, the onus remains on the bears to show they can press the advantage and that recent weakness really is the 'beginning of the end' of the bull market this time vs. yet another buying opportunity.

Aaron Task is Editor-in-Chief of Yahoo Finance. You can follow him on Twitter at @aarontask or email him at altask@yahoo.com.