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Key Takeaways
- The stock market rises most Thanksgiving weeks, though trading is generally light.
- U.S. markets close on Thanksgiving Day and trade for only half a session on Black Friday.
- Analysts expect record-breaking consumer spending this year—over $1 trillion in total sales—which could help sustain that positive tone heading into December.
If you’re wondering whether to adjust your portfolio as much as your belt for the Thanksgiving holiday, here’s what the data shows: Thanksgiving week tends to be a modest winner for stocks, but don’t expect fireworks.
Since 2000, the Dow Jones Industrial Average has climbed about 56% of the time during Thanksgiving week—barely better than a coin flip—with the biggest gains coming on the lightest trading days: the Wednesday before and the Black Friday half-session after. The data has been much the same for the broader S&P 500 index, too, which has been positive about 60% of the time during the Tuesday-through-Friday period of Thanksgiving week since 1928.
The surprise for most is how stocks generally do on Cyber Monday—the day retailers count on for online sales. The Dow has been down about two-thirds of the time (63%) over the past 25 years, though the average change over that period is a drop of just 0.40%.
How Stocks Perform During Thanksgiving Week
This year, market sentiment depends in part on consumer mood, with Adobe Analytics and the National Retail Federation (NRF) expecting record holiday spending—Adobe projects a boost of 5.3% in holiday sales over 2024, while the NRF forecasts total holiday sales topping $1 trillion for the first time.
That optimism could put wind in the sails of retail stocks.
Fast Fact
The U.S. stock market is closed on Thanksgiving and takes a half-day on Black Friday, closing at 1 p.m. Eastern.
While shoppers line up for deals, traders often take a more relaxed approach—Thanksgiving week is one of the lowest-volume stretches of the year. The typical price changes are also relaxed, as the Dow Jones Industrial Average tends to gain modestly during Thanksgiving week, averaging about +0.3% since the 1950s.
Historically, the best days are the Wednesday before and the Friday after the holiday, both of which see positive returns more than 70% of the time, reflecting lighter trading and a generally upbeat mood.
This year, traders are watching whether the same “holiday effect” will hold amid concerns about an AI bubble, worries over whether the Federal Reserve will cut rates in December, and mixed economic data.
Even small moves this year could help set the tone for December’s traditional “Santa Claus rally,” when optimism about consumer spending, which always increases that month, and year-end positioning have historically lifted stocks about 80% of the time.
Why Is It Called Black Friday?
Black Friday got its name in Philadelphia in the 1960s. The annual Army-Navy football game brought in tons of tourists, who were also on hand to descend on shops the day after Thanksgiving. The police took to calling the long work day of traffic, crowds, and bad weather “Black Friday.”
When Did Black Friday Sales Begin?
Thanksgiving holiday sales were coordinated under “Black Friday” in the 1960s. Black Friday began in Philadelphia when tourists would descend on the city on the day between Thanksgiving and the annual Army-Navy football game held on Saturday. After the game, shops and department stores offered major holiday sales, drawing major crowds.
What Is Cyber Monday?
Cyber Monday takes place on the Monday following the Thanksgiving weekend. Online retailers offer sales, and traditional retailers offer website-only deals.
The Bottom Line
Don’t expect Thanksgiving week itself to make or break your portfolio returns. The moves this week tend to be small, trading is light, and Cyber Monday has historically been a letdown for the Dow. But if you’re holding retail stocks, the five-day shopping marathon from Thanksgiving to Cyber Monday offers a stress test of consumer sentiment—and that matters far beyond Black Friday.
