Is there anything remotely common between the stock market’s performance and the Olympic Games? Bizarrely, our research shows that indices fell steeply in various countries when it is the Olympic year.
2020 is no different. The latest edition of the Olympics was scheduled to held in July and August in Tokyo and, lo and behold, the Dow Jones index in the US has tanked by a whopping 38% so far. It is true that the decline in shares this year has to do with the Corona Virus which has swept through the world in the last four months infecting more than two million people and the bad performance of the markets has nothing to do with the Olympics. But it seems like most of the Olympic years are jinxed for the stock markets.
Let’s see some data points in the past – 2000 Summer Olympics, known as Sydney 2000 saw the stock markets tank by 37% (due to collapse of the Dotcom bubble). The 2004 edition of the Olympics of 2004 in Athens witnessed Dow Jones losing 9%. Then barely a month after the conclusion of the 2008 Olympics in Beijing, Lehman Bros collapsed, and the sub-prime lead to the Dow Jones plunging by 53%. Olympic years seem to be interwoven with the Great Depression (1928), World War II (1940), and now this Great Lockdown – a very strange co-relation! Generally, investors go by logic, market conditions, and their gut feelings while investing but superstitious people would definitely stay away from investing especially during an Olympic year!