What do these words above have in common…
Correct!!! St. Patrick’s Day!!!!
Leprechauns are mythical creatures that stem from Irish fables and wherever there is a rainbow it is said you will find a pot of gold, which in present day, we know as “green” or “money”.
The original stories told about Leprechauns are that they were tiny shoemakers who stored their money they made in pots and stored the pots at the end of the rainbow to hide it.
Now tell me…. Do you think this next analogy is a myth or real…
For whatever reason, the day before St. Patrick’s Day tends to be a good one for stocks, according to the Stock Trader’s Almanac. Since 1953, as measured by the Dow Jones Industrial Average, the trading day before St. Patrick’s Day has been good for a gain of 0.31 percent. St. Patrick’s Day itself, the Dow has only risen on average of 0.14 percent. Experts have many “ideas” to why this is, but here are just a few.
It could be seasonal; mid-March is typically a good time of the year for stocks. It could also be the impact of the first quarter’s options expiration. But most experts think it is mostly due to emotions and libations. “As people look forward to having fun, they’re feeling better, and so markets perform better” says Dan Turov, editor of the daily and monthly market newsletter, Turov on Timing.
Experts also say that, like all market predictors, the St. Patrick’s Day indicator has been proven wrong. In fact, in 2005 there was a mix of bad news from General Motors and surging oil prices, which sent stock prices lower on the two days prior to the holiday.
Last year at this time consumer’s confidence was likely to take a hit from rising gas costs. Experts predicted that consumption in the market would slow, but was more likely to be just a brief pause, rather than a true contraction. The labor market and domestic economic data continued to improve and the Dow Jones, S&P 500, and NASDAQ all broke out to new recovery highs.
But what will happen this year on March 17th, 2013…..
Wall Street Journal experts believe that the three most important factors of this mythological month will be;
- Improving Risk-Reward for Financial Institutions
- Stay Positive on Consumer Plays into China
- Stay Cautious on China Infrastructure Plays, such as Industrial and Mining Companies
Market Beat took the aspect of the Dow Jones breaking records this month and the possibility of it to continue. The price weighted index of the DJIA is at an ultimate high since October 2007 due to the four largest companies: IBM, Chevron, 3-M and Caterpillar having a good first quarter. Most stocks are trending up in this broad based rally, and this is a good sign.
In 1961 the laws surrounding the traditions of St. Patrick’s Day were changed, which led citizens to spend more money in the bars and restaurants on this specific day. The color green was once known as “unlucky” in Ireland if worn on this day, and Saint Patrick was actually British, not Irish!
This has led most of us not to believe in the Irish fables and myths passed on by this day – but what do you think? What do you think will happen on Friday or Monday in the stock market? Keep your spirits up and enjoy the authenticity, tastes and advocates of this spirited day.