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Here’s how stocks perform after a solar eclipse

By Joe Ciolli From Business Insider

A total solar eclipse may represent a blockage of sunlight, but the stock market has historically caught fire after past occurrences.

US equity prices have climbed by 17.2% on average in the year following total solar eclipses visible from the US, according to data compiled by LPL Financial. Most recently, stocks rose 9.9% in the year after the July 1991 eclipse.

“History has shown us that since 1900, any time a total solar eclipse has been seen in the U.S., equity prices have gone up,” LPL Financial senior market strategist Ryan Detrick wrote in a recent blog post. “It appears our biggest worry isn’t what stocks might do, but whether those glasses we bought online are officially approved by NASA!”

Of course, this research must be taken with a grain of salt. There are so many other drivers of equity performance that any correspondence with the solar calendar should be viewed as a coincidental byproduct.

The S&P 500 is about 8 1/2 years into a bull market, already the second-longest on record. Its continuation will hinge on whether corporations can keep growing earnings and on whether economic conditions can remain robust.

“Should you ever invest based on the solar system? Absolutely not,” Detrick said. “Things like fundamentals, valuations and technicals are still what drive markets.”

Here’s LPL’s full breakdown of past performance after a total eclipse:

 

 

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