Investors have endured a miserable stock market lately. The S&P 500 is down 10% since the middle of July. And the Dow Jones Industrial average is suffering another triple-digit loss today.
You may have hoped that the Fed’s decision to delay raising interest rates last week would have stymied the correction. Alas, no. As MONEY’s Paul Lim points out, the sell-off is occurring despite Wall Street’s fervent desire for Fed Chair Janet Yellen to keep short-term interest rates at basically zero. It seems as if nothing can lift the spirits of suddenly dour stock brokers.
But there still might be light at the end of the tunnel, and if so, investors may have Pope Francis to thank.
Friday will mark the fifth time a pontiff has spoken at the United Nations, which has meant good things for the stock market, says S&P Dow Jones Indices senior index analyst Howard Silverblatt. Stocks rose the four other times the vicar of Christ addressed the U.N., compared to the historical average of up days which is 52% of the time, averaging a 0.79% gain.
The last time a pope visited New York — Benedict XVI on Apr, 18 2008 — equities jumped 1.8%.And that was in the midst of the financial crisis.
Of course as intelligent, wise, long-term investors, you’ll know better than to buy equities simply because the Bishop of Rome is in town.
But don’t be surprised if stocks turn positive tomorrow, since markets can be a lot less rational than you might think.
Case in point – stocks tend to go up on sunnier than expected days. It turns out that if people are in a good mood, they’re more likely to buy than sell.
After two dour months, you’ll probably take any relief you can get.