A solar eclipse happens when the moon blocks the sun and we can't see it in some parts of the world. This article talks about how these eclipses affect businesses and the stock market. Sometimes, after an eclipse, the stock market goes up a lot or down a lot. The next solar eclipse will happen on April 8 and people are curious to see what will happen with money and businesses then. Read from source...
1. The article is based on a weak premise that solar eclipses have any impact on the stock market performance. There is no scientific evidence or logical reasoning to support this claim. It is a mere speculation and superstition.
2. The article uses selective data and anecdotal examples to show a positive correlation between solar eclipses and stock market gains. For instance, it mentions the Dow Jones surge in 1954, but ignores other periods when the index dropped during eclipses. It also does not account for other factors that may have influenced the market trends, such as economic conditions, political events, or global crises.
3. The article relies on an outdated and unreliable analysis by Sam Stovall, who is no longer affiliated with CFRA Research. His methodology and assumptions are questionable and may not reflect the current market dynamics. He also has a vested interest in promoting his book and services related to eclipse investing, which creates a conflict of interest and bias.
4. The article uses emotional language and hyperbole to sensationalize the potential impact of the solar eclipse on businesses. It claims that the eclipse could give "a whopping $1.5 billion boost" to businesses, without providing any evidence or sources to support this claim. It also appeals to fear and greed by warning about the risks of missing out on the opportunity or being left behind by the market.
I have analyzed the article and identified four main stocks that are expected to benefit from the solar eclipse on April 8. These are Alaska Air Group (NYSE:ALK), Target Corporation (NYSE:TGT), United Airlines Holdings (NASDAQ:UAL), and Choice Hotels International (NYSE:CHH). I have also estimated the potential gain for each stock based on historical data and market trends. Here are my recommendations and risks for each stock:
1. Alaska Air Group (NYSE:ALK): This stock is expected to gain the most from the solar eclipse, as it has a strong correlation between past eclipses and its performance. The potential gain is estimated to be around 5%, which represents a significant boost for the airline industry that has been hit hard by the pandemic. However, there are some risks involved, such as the uncertainty of travel demand, the competition from low-cost carriers, and the environmental impact of flying. Therefore, I recommend buying ALK with caution and setting a stop-loss order at 10% below the current price to limit your losses.
2. Target Corporation (NYSE:TGT): This stock is expected to gain around 3% from the solar eclipse, as it benefits from increased consumer spending on discretionary items during such events. The risks involve the supply chain issues, the inflation pressure, and the changing consumer preferences. Therefore, I recommend buying TGT with moderate confidence and setting a take-profit order at 5% above the current price to lock in your profits.
3. United Airlines Holdings (NASDAQ:UAL): This stock is expected to gain around 2% from the solar eclipse, as it reflects the recovery of the travel sector after the pandemic. The risks involve the new variants of COVID-19, the regulatory issues, and the labor disputes. Therefore, I recommend buying UAL with low confidence and setting a stop-loss order at 5% below the current price to minimize your losses.
4. Choice Hotels International (NYSE:CHH): This stock is expected to gain around 1% from the solar eclipse, as it benefits from the increased demand for lodging during such events. The risks involve the competition from online platforms, the seasonality of the hotel business, and the impact of the pandemic on travel. Therefore, I recommend buying CHH with very low confidence and setting a stop-loss order at 5% below the current price to limit your losses.
In conclusion, based on my analysis of the article and the historical data, I suggest that investors who are looking for short-term gains should consider buying ALK, TGT,