Stock Market Is Closed on MLK Day, Investors Should Plan Accordingly

In the U.S., MLK (Martin Luther King Jr.) Day is a federal holiday. It marks the birthday of Martin Luther King Jr., which falls on Jan. 15. The holiday is observed on the third Monday of January every year. Many investors wonder if the stock market will be open as usual on MLK Day, and the answer is no.

The U.S. stock exchanges don't run seven days a week, 24 hours a day. The Nasdaq and the NYSE are closed on several days every year. What are the stock market holidays in 2021?

The U.S. stock market will be closed on MLK Day, which falls on Jan. 18 in 2021. On MLK Day, investors won't be able to buy or sell stocks on the Nasdaq and the NYSE. Normal trading hours will resume on Jan. 19. The normal trading hours for the U.S. stock markets are from 9:30 a.m. to 4:00 p.m. ET on Monday through Friday. The stock market is closed on the weekends.

The U.S. bond market will be closed on MLK Day. The bond market follows a different schedule than the stock market. As a result, there are days in the year when the bond market is closed and the stock market is open.

The London Stock Exchange, the Shanghai Stock Exchange, the Toronto Stock Exchange, and the Tokyo Stock Exchange are all open on MLK Day since it's an American holiday.

The stock market holiday schedule is different than the federal holiday schedule. Active traders and investors should note the days when the stock market is closed and plan accordingly. The Nasdaq lists nine major holidays when the stock market will be closed in 2021: 

• Jan. 1 for New Year’s Day
• Jan. 18 for Martin Luther King, Jr. Day
• Feb. 15 for President's Day
• Apr. 2 for Good Friday
• May 31 for Memorial Day
• July 5 for Independence Day (Observed)
• Sept. 6 for Labor Day
• Nov. 25 for Thanksgiving Day
• Dec. 24 for Christmas Holiday (Observed)

In 2020, the S&P 500 Index increased by about 18 percent and ended the year at 3,756. Technology giants Amazon, Facebook, Apple, Microsoft, and Alphabet contributed to the rally.

In 2021, Goldman Sachs expects the S&P 500 Index to surge about 14 percent. The investment bank’s chief U.S. equity strategist, David Kostin, thinks that the S&P 500 Index could reach 4,300 by the end of 2021. The boost would be driven by a surge in corporate earnings and a low rate of interest environment that's attractive for companies. An additional 7 percent growth in the S&P 500 Index is estimated for 2022.

However, not everyone is as bullish as Goldman Sachs. Wells Fargo, Morgan Stanley, and LLP Financial think that the S&P 500 Index will only rally by about 6 percent to 3,900 by the end of 2021.