WHAT IMPACT DOES CHRISTMAS HAVE ON THE MARKET?

Businesses begins to shut down around this time, getting ready for Santa and his reindeer to arrive. Many investors still get to monitor their portfolios and the fluctuations of the stock market. As consumers rush to buy gifts, revenues for companies in the retail and technology industries typically increase, which has an impact on the success of the stock market.

This time of year, the so-called Santa Rally starts to take effect beginning of January.

In this post, we'll discuss several important ideas to bear in mind while trading over the Christmas season as well as some industries to pay particular attention to.

Is Christmas Day when the stock market is open？

The stock market is closed on a very small number of days. One of those days is Christmas. Christmas Day in 2022 falls on a Sunday, the stock market will also be closed on Boxing Day, which is on Monday, December 26. When markets are being stopped for a period longer than two days, asset prices often fall in the days before the break. Investors closing positions and lowering their portfolio exposure are the main causes of this.

After all, anything may occur during the course of the three days.

Sectors to Pay Special Attention to This Christmas There are three key areas you should pay close attention to.

Travel Sector

The travel sector is first. The majority of nations have reopened their borders and welcomed travelers after two years of harsh restrictions on international travel because of Covid-19 regulations. Result of the booming demand for both domestic and international travel, airfares have risen to their highest levels in more than five years.

Airlines to keep on your watchlist are:

· Continental Airlines (AALG)

· Qantas (QAN) (QAN)

· Spirit Airlines Southwest Airlines (LUV) (SAVE)

Retail Sector

Given that this is the giving season, it shouldn't be a huge surprise that the second industry should beat the market this Christmas season. The retail industry has been under pressure, spending on discretionary items was slowed down by a hefty cost of living hike. However, inflation has decreased over the past few months, which might allow consumers to spend more on retail goods.

Over the coming weeks, keep an eye on certain important retail stocks such as:

· Target (TGT)

· Walmart (WMT)

· Amazon (AMZN)

Industry of Produce and Food

The businesses in the food and produce sector are the final industry that could outperform during this year and into the new year. Families spend a lot of money on food for Christmas breakfast, lunch. In particular, higher input costs allow manufacturers and suppliers to raise prices a little bit during the Christmas season in order to boost their revenue figures.

Following are a few food and producer equities that should do well this holiday season:

· Tyson Foods (TSN)

· Mondelez International (MDLZ)

· PepsiCo (PEP)

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Lessons to be Drawn from Previous Christmas Seasons

For a multitude of factors, the Christmas season in 2022 might be entirely different from recent years. The fact that COVID-19 isn't as much of a hindrance to our life as it was the prior two years is one of the key ones. Second, global inflation rates have soared to the greatest levels in decades, forcing consumers to reduce discretionary spending and forcing central banks around the world.

The S&P 500 rose an average of 4.5% higher in the weeks running up to Christmas and through the New Year.

What the Santa Claus Rally Means for the Stock Market

The Santa Claus rally takes place from the end of December to the beginning of January, and during this time, stock price rise. There are differing opinions on the many causes of this, but December has traditionally been a good month for stock market bulls.