How World Cup Wins Boost the Stock Market

A study by Goldman Sachs found that winning the world cup boosted the stock market by an average of 3.5%.

However, the country that loses the world cup final sees its stock market fall by 5.6%

But, why?

They found that winning a football tournament doesn't really increase the value of a country's businesses.

There may be slightly higher spending, for example, as people go out to bars to watch the matches, but the team that loses in the final would also see these benefits.

The difference is likely due to human psychology.

When people are happy, they're often more optimistic about the market, leading them to spend and invest more, therefore boosting the economy.
Losing a cup final will have the opposite effect, with people being more negative about the market.

That being said, the paper finds this to be a short term boost and stocks will fall back down in the future, so traders may be looking to buy shares now and sell them on in a month or two.

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