Santa Claus Rally: 5 ASX stocks to keep on watchlist


  • Santa Claus Rally is a period of buoyant stock market activity during the concluding week of December and the first two trading days of January. 
  • Several companies, especially in the fashion, food, gifting, and leisure areas, witness strong consumer activity fuelled by holiday spirit and bonuses. 
  • Installment payment platform Sezzle reported strong performance, driven by Black Friday and Cyber Monday sales.

The consumers have already tuned in to the festive bash as Black Friday and Cyber Monday went on a shopping spree in November. Meanwhile, amidst the shopping frenzy, investors are eyeing the Santa Claus Rally, a period of buoyant stock market activity during the concluding week of December and the first two trading days of January. The rally is driven by optimism in the financial markets, fuelled by investing of holiday bonuses and strong business activity in the consumer market. 

Holiday season, Christmas shopping

Source: Copyright © 2021 Kalkine Media

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During the period, several companies, especially across categories such as fashion, food, gifting, and leisure activity, typically witness strong sales and revenue, anticipated to reflect in their share price movement.

5 ASX stocks to keep on watchlist


Let us look at five such stocks that are on the radar as investors eye to cash in on the spirit of the holiday season.

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Sezzle Inc. (ASX:SZL)

The fintech sector has proven to be a gateway to convenient and enhanced shopping experiences for consumers in the current times. 

Installment payment platform Sezzle recently reported strong performance driven by Black Friday and Cyber Monday sales.

For the 4-day Black Friday and Cyber Monday period, Sezzle’s Underlying Merchant Sales (UMS) in the US and Canada edged up 53% YoY, with the Company experiencing significant growth both online (up 46%) and instore (up 783%).

The fintech company’s UMS reached an annualised run-rate of US$2.5 billion as its UMS for November rose 83% YoY.

Woolworths Group Limited (ASX:WOW)

Food and grocery shopping is undoubtedly a customary and critical part of successfully preparing for the big traditional dinner. On this front, Woolworths’ supermarket chain in Australia is expected to service millions of customers on the lookout for essentials for the holiday season. 

ALSO READ: Five ASX-listed food stocks to keep an eye on ahead of Christmas

Recently, Woolworths offered AU$872 million in a takeover bid for Australian Pharmaceutical Industries (API). Meanwhile, the rival Wesfarmers has offered AU$764 million in a scheme of arrangement.

API is one of Australia’s leading health and beauty retailers and pharmaceutical distributors whose acquisition would provide fantastic addition in the health and wellness area. 

Cettire Limited (ASX:CTT)

Many welcome the holiday season as an opportunity to treat themselves and their close ones with some luxurious goodies.

With luxury brands leaving no stones unturned to entice the customers, Cettire could prove to be an online fashion emporium for Aussies. Cettire, a global luxury online retailer, is offering sales on top designers from Balmain to Versace in the current holiday season.

The Company also witnessed strong trading performance over the four months ended 31 October 2021, with sales revenue growing 172% over pcp. 

ALSO READ: 5 high-growth shares for Christmas month

Online luxury shopping

Source: Copyright © 2021 Kalkine Media

JB HI-FI Limited (ASX:JBH)

Consumers’ growing love for electronics and gadgets in the present world is unquenchable, and the upbeat sales trend is expected to continue beyond Cyber Monday. When it comes to shopping for electronics, JB HI-FI is a popular name in Australia. The Company offers the world's leading brands of computers, tablets, TVs, games and many more. 

For the period 1 July 2021 to 30 September 2021 (Q1 FY22), the Group continued to see heightened customer demand and strong sales growth rate over a two-year period. 

Tabcorp Holdings Limited (ASX:TAH)

Many view the upcoming holiday season as the perfect opportunity to gamble and celebrate, especially when bonus offers dominate the casinos.

Australia’s largest gambling company, Tabcorp Holdings Limited has remained resilient despite the significant disruption during lockdowns and delivered a solid operational result in FY21. The Group is pursuing a demerger to create two market-leading entities- Lotteries & KenoCo and Wagering & GamingCo, both planned to be listed on the ASX. 

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