Investors everywhere are asking the same question heading into the biggest commercial holiday of the year: Is the stock market closed on Christmas Eve?
Well, in short, yes.
This year, Christmas falls on a Monday, which means Christmas Eve is on Sunday. As such, the stock market will be closed on both Christmas Eve and, of course, on Christmas, which is a federal holiday.
Normally, Christmas Eve is actually a half day for the stock market. However, this year, because it falls on a day that the market is already closed, the holiday has no effect on the trading schedule.
Notably, some companies have assigned this Friday, Dec. 22, as a de facto Christmas Eve holiday. However, Dec. 22 will still be a full trading day as it pertains to the stock market.
Is the Stock Market Closed for Christmas Eve 2023?
U.S. federal holidays, which can be dated all the way back to the 1800s, typically result in stock market closures. In fact, some holidays have interesting historical relationships with stocks.
Christmas, for example, is typically associated with a “Santa Claus Rally” which “typically occurs during the last five trading days of the year and the first two trading days of the new year.”
While the psychological trend is certainly imperfect in its more than 60 years under observation, 2023 is shaping up to be quite jolly heading into the end of the year.
Indeed, U.S. stocks have been red-hot recently. Just last week, the S&P 500 closed its longest win streak since 2017 as investors celebrate the notion of impending rate cuts. Currently, the S&P is less than 1% away from reaching a new all-time high, set to surpass its previous peak dating back to early 2022.
Reasonably so, investors have plenty of reasons to be in a good mood this holiday season. Inflation is down, consumer spending and unemployment are still strong and it’s only a matter of time before interest rates fall. The Federal Reserve’s “soft landing” is seemingly in motion with just weeks until the new year.
Still, whether this trend continues into Dec. 25 and the new year remains to be seen.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
