The Dow’s Santa Claus Rally
Where’s our Santa Claus Rally?
Back in the good old 20th century we regularly had a rally in the stock market in the days leading up to Christmas. During the last decade of the century it became such a regular part of the year end, everyone expected a “Santa Claus” rally.
Every December in the 1990s, with the lonely exception of 1997, the Dow Jones Industrial Average rose during the five trading days before Christmas. In fact, the Dow rose in 13 of the final 14 sessions of 1991, climbing a total of 10.7 percent. It was called “the mother of all Santa Claus rallies.”
Christmas was not so merry for investors 95 years earlier. Because of World War I, the New York Stock Exchange suspended operations in July 1914. It resumed limited trading on Dec. 12. By Dec. 24, 1914, the Dow had fallen to 53.17—its lowest reading since 1907.
Full trading did not resume until April 1915. After the nine-month closure, a new tradition was established. Henceforth, the market would never be closed for more than three days. That is why the stock market holds a half-day session on the day after Thanksgiving.
Chip Wood is the geopolitical editor of PersonalLiberty.com. He is the founder of Soundview Publications, in Atlanta, where he was also the host of an award-winning radio talk show for many years. He was the publisher of several bestselling books, including Crisis Investing by Doug Casey, None Dare Call It Conspiracy by Gary Allen and Larry Abraham and The War on Gold by Anthony Sutton. Chip is well known on the investment conference circuit where he has served as Master of Ceremonies for FreedomFest, The New Orleans Investment Conference, Sovereign Society, and The Atlanta Investment Conference.
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