US equity markets are closed this coming Friday in observance of Good Friday, and with many schools out and families on vacation, trading activity this week may take on a slightly muted tone. Good Friday is unique in terms of the financial markets for two reasons. First of all, because it is not a Federal holiday, there have been several instances when a key economic indicator was released on a day the equity markets were closed. Back in 2012, for example, the release of the March employment report coincided with Good Friday (4/6/12), so for that report, which was well short of expectations, investors had to wait until the following Monday to make any adjustments to their portfolios. The second aspect of Good Friday that makes it unique is that unlike other market holidays which occur around the same time each year, the timing of Good Friday can fluctuate anywhere from late March through late April depending on the lunar cycle.
The table below lists the performance of the S&P 500 and the US Long Bond Future in the week of Good Friday over the last 25 years. For each year, we calculated performance from the close on the Friday before Good Friday to the close on the Thursday before Good Friday. Looking at the table, the week of Good Friday has been positive for equities. The S&P 500 has been positive on the week nearly two-thirds of the time (64%) for an average gain of 0.90%. More recently, the S&P 500 has seen gains in six of the last seven years for an average gain of 1.27%.
For long-term Treasuries, the week leading up to Good Friday has not been nearly as good. Since 1989, the US Long Bond Future has averaged a decline of 0.13% with positive returns less than half of the time. More recently, however, just as equities have been positive, so too have bonds as the Long Bond Future has been positive in the week before Good Friday for four years in a row.
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