As the financial industry quietens down for the summer, the stock market has stayed within a narrow range. Even as companies report earnings, many investors are sitting on the side lines waiting for signs of life. The markets are less volatile than they have been in the years since the 2008 financial crisis; however, there are indications that this could be about to change.
“Insights into stock market trends often come from quirky places. Financial astrologists attempt to predict market trends based on the sun, moon and stars, while others make decisions based on unlucky coincidence and superstition”, says Mark Taylor, CEO of Selftrade from Equiniti.
“With company valuations at unusual highs some are pointing to solar and astral events that are happening in the next month to make worrying predictions.”
Much is being made in the US of the so called “Great American Solar Eclipse”, which takes place on August 21st. The Harriman Stock Market Almanac recently reviewed 15 solar eclipses visible from America since 1900, and found that just 13pc of the days before an eclipse experienced a positive return, compared with 47pc for the day itself and 80pc on the day afterwards.
“On the day before and the day of each eclipse the average return of the Dow Jones index was minus 0.3 per cent, and the average on the day after the eclipse was just 0.2 per cent. The trend indicates that superstitions around eclipses still exist – will the pattern repeat next week?”
