Don’t bother calling your broker when the World Cup is on the TV. Analysis of share volumes shows there is a noticeable dip in the number of trades during World Cup matches in which the market’s national team is playing.
Happily, most World Cup matches this year have been scheduled during European evenings or weekends, leaving traders free to focus on their job during the day. But when matches are played in the afternoon, it seems it can interfere with the critical period leading up to the market’s close, when a very high proportion of trades are cleared.
Using World Cup contender France as an example, the French national team has played two matches corresponding with the final 90 minutes of Paris trading. Compared with the final 90 minutes of recent trading days, both ended up being the second- and third-lowest volume periods.
French CAC 40, volume in final 90 minutes of trading (million)
Source: Lonsec, Bloomberg
As the chart above shows, volume in the final 90 minutes of trade on 26 June (France v Denmark) was around 36 million, and on 6 July (Uruguay v France) it was around 35 million. This compares to an average volume for the period of around 45 million, although this number is skewed by the high-volume period on 15 June when trade-related fears gripped Europe’s markets.
France is not only beating the competition on the field, it is also leading its rivals in share market performance. While it has been a rocky start for European shares since the start of the year, the French CAC 40 index remains ahead of the UK, Belgium and Croatia, as well as world game juggernaut Germany, bouncing back from the global share dip at the start of 2018.
Performance of World Cup qualifying markets (H1 2018)
Source: Lonsec, Bloomberg
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