Black Friday — the name given to the first day after Thanksgiving — is one of the most important retail and spending events in the United States.

Every holiday season, prognosticators make predictions about the level of sales on Black Friday, and investor confidence may be affected by whether or not those expectations are met. If consumers follow up Thanksgiving by spending a lot of money on Black Friday — and retailers show strong numbers — then investors might have their first indication that it is shaping up to be a particularly profitable shopping season.

This confidence is reflected in the stock market. In this manner, Black Friday could be considered a leading indicator for the markets.

Conversely, many take it as a sign of trouble if retailers are unable to meet expectations on Black Friday. Concern over the health of the economy is magnified if consumers are perceived to be saving too much. This can cause the stock market to suffer.

NYSE: Holidays and Trading Hours

Thanksgiving is an important day for a lot of businesses, particularly those in the food industry. However, stock market trading is unlikely to be affected by Thanksgiving alone because of the importance of the day after. Black Friday is important because this is the shopping day on which many retailers have traditionally made enough sales to put them in the black for the year.

Since many retailers consider Black Friday to be crucial to their business's annual performance, investors look at Black Friday sales numbers as a way to gauge the overall health of the entire retail industry. Economists, based on the Keynesian assumption that spending drives economic activity, view lower Black Friday numbers as an indication of slowed growth.

According to the research conducted by National Retail Federation, in holiday sales have the potential to increase by 3.

US Stock Market Holiday Calendar ,

The stock market can be affected by having extra days off for Thanksgiving or Christmas. The markets tend to see increased trading activity and higher returns the day before a holiday or a long weekend, a phenomenon known as the holiday effect or the weekend effect.

Many traders look to capitalize on these seasonal effects. Many analysts and investors scoff at the notion that Black Friday has any real Q4 predictability for the markets as a whole. Instead, they suggest that it only causes very short-term gains or losses. A Market Watch analysis performed by Mark Hulbert looked at a year sample on stock market performance following Thanksgiving and throughout the rest of the calendar year.

What’s the Real History of Black Friday? - History in the Headlines

He concluded that there was no correlation between a Black Friday bump and Q4 performance. Thanksgiving and Black Friday can have major short-term trading implications on Wall Street, but their long-term stock market effects remain uncertain.

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How is the stock market affected by Thanksgiving and Black Friday? By Investopedia Updated November 18, — Understanding Thanksgiving and Black Friday Thanksgiving is an important day for a lot of businesses, particularly those in the food industry. Black Friday and the Stock Market Many analysts and investors scoff at the notion that Black Friday has any real Q4 predictability for the markets as a whole. Black Friday is a popular label attached to the Friday following Thanksgiving Day in the US.

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Retailers are eager to cash in on the all-important holiday shopping season. But what exactly should investors make of the ensuing sales figures?

If you're shopping the post-Thanksgiving sales this year - whether online or in-person - you'll find great bargains at these deep-discounting retailers.

Learn which big-box retailers are and are not open on Thanksgiving Day, and it how it might impact those retailers. The term Black Friday can be used in a couple of different contexts; one positive and one negative.

Black markets will continue to exist as long as we have regulations and taxes. Discover how they work. You don't have to wait until the day after Thanksgiving to do your Black Friday shopping at Amazon. The retailer started its Black Friday early. These states have great deals on your day-after-Thanksgiving purchases. No — or lower — sales taxes. A description of a positive balance on a company's financial The segment of a country's economic activity that is derived An expense ratio is determined through an annual A hybrid of debt and equity financing that is typically used to finance the expansion of existing companies.

A period of time in which all factors of production and costs are variable.

In the long run, firms are able to adjust all A legal agreement created by the courts between two parties who did not have a previous obligation to each other. A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. A statistical technique used to measure and quantify the level of financial risk within a firm or investment portfolio over Content Library Articles Terms Videos Guides Slideshows FAQs Calculators Chart Advisor Stock Analysis Stock Simulator FXtrader Exam Prep Quizzer Net Worth Calculator.

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