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Santa Claus Rally

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Has the Santa Claus Rally Lost its Steam? - Weekly Market Outlook
Market Intelligence Center  Dec 24  Comment 
Despite a tumble on Wednesday and a pretty nasty dip on Friday, the bulls managed to log a victory last week thanks to a huge surge on Monday and Tuesday... when it actually looked like we may not fall off the fiscal cliff. Now we're back to...
Start of "Santa Claus rally" dampened by "cliff' worries
Reuters  Dec 24  Comment 
U.S. stocks edged lower on Monday as caution over the potential for volatility driven by worries about the U.S. "fiscal cliff" dampened enthusiasm at the start of a seasonally strong period for equities.
Four ETF Laggards As Santa Claus Rally Nears Fiscal Cliff
Forbes  Dec 24  Comment 
The Santa Claus Rally
  Dec 20  Comment 
For kids it's usually toys that they ask from Santa Claus but for us stock market players, it's the Santa Claus rally that most of us ask for. For those who do not know, the Santa Claus rally is the rise in stock prices in the month of December...
First Look: Stocks looks to continue Santa Claus rally
Market Intelligence Center  Dec 19  Comment 
Stock futures indicate a slightly bullish open to trading this morning, continuing a small Santa Claus rally that started at the beginning of the week. There is a small flurry of earnings activity today from big companies such as FedEx (FDX),...
Santa Claus Rally Is Taking Place Where This Year?
Wall Street Sector Selector  Dec 17  Comment 
Santa Claus Rally Is Taking Place Where This Year?
The Santa Claus Rally Stalled As Fiscal Cliff Looms
Forbes  Dec 17  Comment 
We enter the last full week of trading for 2012 with the Dow Industrial Average, S&P 500 and the NASDAQ down slightly last week as the Santa Claus rally stalled.
4 Catalysts for This Year's Santa Claus Rally
FX Street  Dec 16  Comment 
Do you believe in the Santa Claus rally? No, that ain't a jolly old man who gives away plenty of... For more information, read our latest forex news and reports.
Stocks’ Santa Claus Rally Hits a Fiscal-Cliff Speed Bump
Wall Street Journal  Dec 13  Comment 
Stocks fell after comments from House members Pelosi and Boehner about the lack of progress in budget talks.
Santa Claus Rally Continues...
Daily US Stock Market Fundamental & Technical Analysis  Dec 12  Comment 
The Dow posted its 5th straight up day today despite mixed economic data. Santa claus rally seems to be at its fully swing now as US market continues to power upwards despite largely mixed economic data. Sales data were mixed and trade gap...
Five Exchange-Traded Funds Lagging The Santa Claus Rally
Forbes  Dec 10  Comment 
Stocks were mixed last week, but it appears that the Santa Claus rally continues in terms of the Dow Industrial Average and the S&P 500. The NASDAQ has become the laggard coming off a down week.




more ▼WIKI ANALYSIS
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Wade Hansen

As the name suggests, a Santa Claus Rally is when the stock market indices move higher. In fact, according to The Almanac Investor, the S&P 500 has averaged a 1.6 percent gain during this period since 1969. (The time period associated with the Santa Claus Rally is the last five trading days of December and the first two trading days of January.)

Of course, the time period associated with the Santa Claus Rally does not always see a rally in the stock market, and many investors believe these years are particularly ominous. In fact, many investors believe the years following the years in which there is no Santa Claus Rally are most likely going to be bearish years.

The Almanac Investor has a great little saying for this: "If Santa Claus should fail to call; bears may come to Broad & Wall."


What Causes the Santa Claus Rally?

Nobody really knows what causes the Santa Claus Rally. However, some of the following popular beliefs explaining why the stock market goes up seem to make their rounds each year:

  • Investors are more optimistic around Christmas
  • People are investing their Christmas bonuses
  • Investment managers are trying to lock in tax reductions by selling some stocks and buying others
  • All the market bears are on vacation
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