Super Bowl: What the Chiefs win means for stocks

The S&P 500 fell 0.1 percent in 1970, the only other year the Chiefs won the big game

The Kansas City Chiefs are Super Bowl champs, and their victory is not-so-welcome news for stock market investors.

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While the winner has no impact on market performance, returns have been smaller when the team from the American Football Conference (AFC), like the Chiefs, won the big game.

“The S&P 500 Index has performed better, and posted positive gains with greater frequency, over the past 53 Super Bowl games when NFC teams have won,” Boston-based broker-dealer LPL Financial wrote in a blog post.

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The benchmark S&P 500 has gained in 16 of the 25 years, or 64 percent, that a team from the AFC has won the Super Bowl, returning an average of 6.8 percent. In 1970, the one previous year that Kansas City won the championship, the S&P 500 fell 0.1 percent, according to LPL.

By comparison, the S&P 500 has gained an average of 19.2 percent in the five years that the San Francisco 49ers won. If there is any solace in the 49ers loss, it’s that the S&P 500 gained 29.6 percent in 2013, the only other year the 49ers lost in the Super Bowl.

The S&P 500 got off to a hot start in 2020, gaining 3 percent through Jan. 17, but has given up those gains as the coronavirus outbreak has caused global growth concerns. The index was down 0.2 percent year-to-date through Friday, closing at 3,225.52.

Interestingly, the Super Bowl Indicator is more optimistic than what Wall Street was predicting for the stock market this year. Nine Wall Street strategists tracked by FOX Business had an average year-end S&P 500 target of 3,282 – up 2.1 percent from where the index finished last year.

However, the Super Bowl Indicator doesn’t always work. The S&P 500 gained 29 percent last year despite a team from the AFC winning the big game.

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“Stocks did great last year even though the dreaded Patriots (from the AFC) won the Super Bowl,” LPL wrote.