Fans are so crazy about their national soccer team in some countries that winning and losing goes straight to the stocksmarket. I enjoyed watching the US play in the World Cup. There seems to be a lot more interest in the United States. But have we reached the sentiment generated in many other countries?
Three scholars examine the stock market return in 39 countries during the day after the national team gets eliminated from the World Cup. They find that the stock market, on average, earns a return that is 0.49% lower than normal that day. The sad sentiment of the soccer loss turns into the pessimistic sentiment the next day that impacts the stock market.
Has US soccer sentiment risen to that level?
In the 2014 World Cup, the United States’ team played four games. The average daily change in the Dow Jones Industrial Average was +3.87 points per day during the first half of 2014. Let’s see what happened after each game and compare to this average.