Santa Claus Rally Amid Lockdowns in China and Booze Sales

The US stock market this year clearly intends to demonstrate what the "Santa Claus Rally" calendar anomaly is.

Rally Santa Rally is a price pattern in which stocks rally in the last seven trading sessions of the year plus the first two trading days of the New Year. Over the past 92 years, the S&P 500 has risen 77% of the time during the Santa Claus rally, according to Sundial Capital Research. Average growth over this nine-day trading period was 2.66%.

So the last three days in a row of growth fit well with this pattern, but poorly correlate with common sense. Common sense refers to the fundamental background that currently surrounds the US stock market.
In general, markets live in the omicron-took, omicron-dal paradigm. And now is just the phase when the omicron gives rise to growth.

The reason for this hopes for its milder course, confirmation of which are in the form of preliminary studies (the latest study from South Africa showed that the probability of being hospitalized, picking up an omicron, is 80% less than in the case of the same Delta). And the answer to the question of what to do with the omicron is news, like the approval of a magic pill from Pfizer, by drinking which you can overcome the virus inside yourself.

At the same time, the markets do not pay attention to 100K per day of sick in Britain or, even worse, news from China, which continues to remain faithful to its principle of zero tolerance to a pandemic and on this occasion sent 13 million residents of Xi'an to lockdown. Meanwhile, the worst is yet to come: a new peak of the pandemic is expected by the end of next month.

While retail investors buy whatever is bad, American billionaires continue to sell stocks. By early December 2021, they had sold $ 42.9 billion in shares, more than double the $ 20.2 billion sold for all of 2020. Why? According to their financial advisors, it's simple: customers look at prices and believe the market is at the top.