Still, investors have grown accustomed to earning strong stock returns in December which is popularly referred to as the Santa rally, however this year may prove quite different from other years at least in the last 10 years
As the month of December draws close to an end, hopes are being dashed away as the Nigerian All Share Index appears to have returned -2.2 percent so far for investors. This means that the stock market may see its first negative performance in December since 2009 if the market doesn’t post a significant gain on its final trading day on Monday.
Although, investors last experienced a true santa rally in 2016 when the stock market returned about 6.08 percent in the month of December, investors remained hopeful for a strong December rally after the stock market managed to produce positive results for investors in 2017 when it returned 0.79 percent and in 2018 when stocks rose by 1.8 percent despite the slow pace of the economic recovery.
2009 was the last time stocks declined in December in the local bourse. The ASI fell by -0.87% in December 2009 as the world entered the second year of the global financial recession. Since then, Santa Claus has never failed to make investors smile to the bank in December until this year.
Investors have become too accustomed to seeing a green result in December as stocks have only declined 7 times in the last 34 years during the month of December. The average stock return in December since 1985 is 2.47 percent.
While it is still very possible for the stock market to return to positive territory this month, it will take more than just wishes but an actual upward stock price movement on the last trading day on monday to save Christmas this month at the Nigerian stock market.
