How does Black Friday affect the stock market?

How does Black Friday affect the stock market?

Ah, Black Friday. That time of year when we turn from tranquil shoppers into money saving, deal craving, aggressively behaving monsters.

Now, we’re not going to talk about whether Black Friday deals help you save money. If you want to know about that, you can read all about it in our article, ‘Read this before you FOMO into Black Friday’. 

Instead, we’re focusing on the research conducted by Market Watch which looked at how the US’s largest retail index (SPSIRE) fared against Black Friday trends.

Whilst the data shows there's no long-lasting impact between Black Friday and the stock market, there is an interesting inverse (opposite) correlation.

Market Watch found that a strong immediate reaction of the stock market resulted in a weak Q4 performance for retailers overall. The opposite was also true, meaning if there was a weak reaction to Black Friday, there would be a strong Q4 performance.

What's the reason for this? No one quite knows, as this is just a trend.

🤓 Nerd moment - remember, this is a correlation, not a causation! Just because the stock market crashes when Oreo releases a greater-stuffed cookie does not mean a cookie company is controlling the stock market.
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So, does this trend surprise you? Or do you think it all adds up? 

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Meet the authors

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James Ashoo

Senior Content Writer

James has been investing for over five years. His aim is to explain the hard stuff, easily! When he's not chewing your ear off about stocks and crypto, he'll most likely be telling bad jokes.

Harjas Singh

Harjas Singh

Chief Product Officer & Co-Founder

With a wealth of experience in fintech, Harjas is the man in the know when it comes to all things product. Investing features, chatting capabilities and thriving communities – he oversees all development on the Shares app!

Harry Harrison

Harry Harrison

Finance Writer

Harry is an experienced business writer, with a love for all things tech. In his free time, he enjoys reading, playing sport and winning at chess. He also loves posting inside the Shares app!