Shares at the end of the year: let’s get ready for Santa Claus rally

The end of the year is traditionally a part of the year when the value of shares on all the world stock exchanges increase. This year should be no exception.

American index S&P 500 has been increasing regularly since January to first week of November since 1998, on average with 9,5 percent. During the rest of the year the average yield is about 4 percent. The strongest value really does come in the very last days of the calendar year. The phenomenon is called „Santa Claus rally“.

„In last twenty years it worked in 10 cases out of 10, “ Tom Lee, research team leader in Fundstrat Global Advisors reminded. There are 8 more weeks till the end of the year which means we’re still on the very beginning of when to expect Santa Claus rally.

Lee warns that it’s not 100 percent sure that the phenomenon will repeat itself this year, yet the chances are really high. There’s a few things that could set back Santa Claus rally – any external shock, escalation of trade disputies between the US and China or Hard Brexit. Yet, the tension between the US and China is loosening. Lee expects the targeted index S&P 500 value at the end of the year around the level of 3200 points.


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