Columbus Day is an interesting trading day for financial markets as it is one of the few trading days of the year when the equity market is open, but the bond market is closed. This may lead investors to think that equity markets should perform positively, as investors do not have credit markets to allocate capital to on that specific day. However, looking at the S&P 500’s historical performance on Columbus Day over the last 25 years doesn’t necessarily show a real positive bias.  Columbus Day tends to act just like any other trading day. Over the last 25 years, median performance on Columbus Day has been a gain of 10 basis points (bps) with positive returns 55.6% of the time.  While that’s slightly higher than the median one-day gain of 7 bps for all trading days over the last 25 years, the difference isn’t significant.  That’s not to say that Columbus Day hasn’t seen some outliers, though.  Who can forget in 2008, during the middle of the Financial Crisis, when the S&P 500 rallied more than 11% on Columbus Day!

For the week of Columbus Day, the S&P 500’s median gain has been 0.31% with positive returns 63% of the time which also isn’t extraordinary relative to average weekly returns for the S&P 500 over the last 25 years.  The worst Columbus Day weeks were in 1999 (-6.63%) and 2018 (-4.10%) while the best were in 1998 (+7.32%), 2002 (5.87%), and 2011 (+5.98%).  Interestingly enough, in 2008, even after rallying over 11% on Columbus Day, the S&P 500 finished the week up just 4.60% as it erased more than half of its gains from the holiday session.

The table below lists the S&P 500’s performance leading up to and after Columbus Day for each of the last 25 years.  With a decline of over 2.5% since the start of September, this year ranks as the weakest performance for the equity market since 2014. Click here to view Bespoke’s premium membership options.

Print Friendly, PDF & Email