I'm Watching the Santa Claus Rally Closely -- Here's What It Could Mean for Your Returns in 2026

• Over the past 50 years, Santa Claus rallies person occurred 80% of the time.

• In caller years, they've been little frequent.

• The Santa Claus rally has a mixed past of predicting returns successful the consequent year.

• These 10 stocks could mint the adjacent question of millionaires ›

Christmas whitethorn person travel aboriginal for investors!

As of marketplace adjacent connected Dec. 24, the markets had notched a consecutive week of gains. Headlines were hyping a "Santa Claus rally," and analysts were getting acceptable to bust retired the beverage and cookies early.

But the year's not implicit yet, and your investments don't vanish connected New Year's Eve. Here's what this Santa Claus rally could truly mean for your portfolio ... this December and successful 2026!

Investors are definite saying "ho ho ho," arsenic each the large U.S. banal marketplace indices are up implicit the past week. The S&P 500 (SNPINDEX: ^GSPC) has gained 3.3% since Dec. 17, the Nasdaq Composite (NASDAQINDEX: ^IXIC) has risen 4.1%, and adjacent the Dow Jones Industrial Average (DJINDICES: ^DJI) is up 1.8%.

But none of this counts arsenic a Santa Claus rally ... astatine least, not yet.

Technically, the Santa Claus rally play occurs implicit the past 5 trading days of December and the archetypal 2 of January. This year, that's Dec. 24 done Jan. 5 (because the markets are closed connected Christmas Day and New Year's Day, arsenic good arsenic weekends). So immoderate imaginable "Santa Claus rally" gains volition travel on apical of those we've already seen.

Over the past 50 years, a Santa Claus rally -- an wide marketplace summation during the rally play -- has happened astir 80% of the time. On average, the S&P 500 gains 1.3% during the Santa Claus rally period, compared to an mean seven-day marketplace instrumentality of 0.2%.

But implicit the past fewer years, Santa has shown up acold little frequently.

In 2022, 2023, and 2024, the marketplace made large gains successful November, which each preceded December pullbacks, including during the Santa Claus rally period. In fact, the past clip we had a existent Santa Claus rally -- successful which the S&P 500 gained much than 1% -- was 2018, erstwhile it roseate 4.1% (and that was aft a 14.2% marketplace driblet betwixt Thanksgiving and Christmas).

However, conditions look beauteous favorable this year. The S&P failed to acceptable a caller grounds precocious successful November and is coming disconnected of a tiny 2.6% dip. Market sentiment seems buoyed by the imaginable of further Federal Reserve complaint cuts successful 2026. So, yes, Virginia, the beardown rally implicit the past week seems apt to proceed into the Santa Claus rally period.