Some markets will close for the day in order to honor U.S. military servicemen and women, while others will remain open.
Bond pros are one market that is closed this Wednesday, while U.S. stock markets and other capital markets will remain open for trading. Mark Decambre of MarketWatch explains why the holiday is not observed by every market.
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Changing Veterans Day date and observance
In years past Veterans Day was celebrated by stock and bond markets. While some historians claim that the holiday was introduced in 1938, others put the date at 1921. However it wasn’t until 1938 that Veterans Day was declared a federal holiday to be celebrated on November 11.
For reasons unknown that date has shifted over the years, which provides one explanation for the patchy observation of the holiday. Not only has the date changed on multiple occasions, there has never been the same reverence afforded to Veterans Day as to other federal holidays.
November 11 was officially designated Armistice Day, although it has always been fairly loosely defined. According to military.com, it is a celebration of World War I veterans and demonstrates a commitment “to the cause of world peace.”
Congress replaced “Armistice” with “Veterans” in 1954 in order to commemorate those who fought in World War II and the Korean War, but its date remained the same. Then in 1968 Veterans Day was moved to the last Monday of October under the Uniforms Holiday Act signed by President Lyndon B. Johnson.
Money never sleeps so neither does the stock market
Subsequently it was changed again by President Gerald Ford, who moved the holiday back to November 11, where it remains today. As a result the day changes, and sometimes falls on the weekend.
However in years when Veterans Day falls midweek, it is difficult for stock markets to take a break given the speed of modern trading. The markets did honor Veterans Day with a two-minute shut down, but the traditional was halted in 2007.
Bond markets, on the other hand, never officially closed for Veterans Day. However the industry follows the holiday schedule set by the Securities Industry and Financial Markets Association, known as Sifma. One reason for the closure of bond markets may be that the U.S. Treasury Department observes Veterans Day, which means that bond traders are forced to take a holiday too.
In contrast currency markets and commodities markets are open for the day.