When does the Santa Rally usually start?
Taking Stock on Friday 24th November 2023
Taking Stock: Is a look at today's top business news & investment views plus we cover the winners, losers, the most read company news & the most followed. Today this includes:
When does the Santa Rally usually start?
Yale Hirsch, the founder of the Stock Trader’s Almanac, coined the "Santa Claus Rally" in 1972.
He defined the timeframe of the final five trading days of the year and the first two trading days of the following year as the dates of the rally.
These seven days have historically shown higher stock prices 79.2% of the time, reflected in the S&P 500.
The Stock Trader’s Almanac compiled data during the 70 years between 1950 and 2020 and showed that a Santa Claus rally occurred 57 times, with growth in the S&P 500 by 1.3%
Theories that explain a Santa Claus rally include end-of-year tax considerations, a general feeling of optimism and seasonal happiness on Wall Street, and investing holiday bonuses. Some institutional investors settle their books and vacation during this time of year, leaving the market to retail investors, who tend to be more bullish toward the market.
Does the UK experience a Santa Rally?
From 1985 to 2015, the FTSE has indeed made an average gain of 2.26% in the last month of the year, rising in value 83% of the time.
From 1986-2015 the biggest rises in both S&P500 & FTSE 100 typically occur from 16, 15 and 14 December.
Overall, investing from these dates brought an average annual return of 2.53%, and a positive return 87% of the time. In contrast, investing over the first half of the month yielded an average loss of -0.23%.
Companies discussed on “Taking Stock” today:
00:40 & 25:20 Ten Lifestyle #TENG
05:45 XP Power #XPP
05:50 Videndum #VID
06:00 SigmaRoc #SRC
07:30 BSF Enterprise #BSFA
07:50 Aurrigo #AURR
10:25 Team17 #TM17
16:25 & 42:20 Diageo #DGE
17:06 Harland & Wolff #HARL
17:53 Legal & General #LGEN
18:49 Ilika #IKA
24:52 Totally #TLY
29:30 Future Plc #FUTR
40:30 Dr. Martens #DOCS
41:20 Unilever #ULVR
RESULTS ANALYSIS
Team17 #TM17 - Trading Update
"The Group now expects to deliver full year adjusted EBITDA of at least £28.5m, which includes non-cash title impairments of up to £11.5m"
Profit for the year
2022 = £23,478
2021 = £23,739
So profit for the year is around 34% lower than Adjusted EBITDA.
So if this is the same this year their profit for the year = £18,810,000
Current market Cap = £270m / = £18,810,000 = PE of 14
CHART OF THE DAY
Future Plc #FUTR
TOP BUSINESS STORIES
Nissan to lead £2bn investment in UK electric car plant
Nissan and its partners have announced a £2bn plan to build three electric car models at its Sunderland factory.
The Japanese firm will build electric Qashqai and Juke models at the plant alongside the next generation of the electric Leaf, which is already produced there. The scheme could help preserve the jobs of about 6,000 workers directly, and thousands more across the UK.
Nissan said that alongside this, a major new battery plant known as a "gigafactory" will also be needed.
UK consumer confidence jumps despite lingering inflation pain
British consumers have turned more optimistic about the outlook for the economy and their personal finances this month but their mood remains a long way off pre-COVID levels, market research firm GfK said on Friday.
Despite lingering cost-of-living pressures, GfK's headline consumer confidence index was stronger than anticipated in November, increasing to -24 from October's three-month low of -30.
November's reading was above the -28 forecast in a Reuters poll of economists, and follows a sharp fall the month before.
The chart below shows consumer confidence since 2007.
Thatchers invite judge to 'taste test' in row with Aldi
A judge has been invited to take a "taste test" of rival cider drinks in a High Court trade mark dispute.
Somerset brewer Thatchers is suing German discount retailer Aldi for infringing the trademark of its Cloudy Lemon Cider.
The family firm accuses Aldi of gaining an unfair advantage by copying the product for its Taurus cider "in both taste and appearance".
Aldi lawyers denied it was "riding on the coat-tails" of Thatchers.
The trial began in London on Thursday.
Thatchers' Cloudy Lemon Cider was released in February 2020, and Aldi's Taurus brand in May 2022.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.