The stock market is open on New Year’s Eve, 31st December 2025, until 4 pm ET, but the US bond market will close early at 2 pm ET. While this appears to be a relatively simple question, there is much underlying importance to the date and the timing when it comes to trading stocks. After 31st December’s close, the market will be reopened only on Friday, 2nd January 2026.
During this short window, the market will remain closed for all traders. The holiday-shortened week is typically a volatile environment with thin liquidity, and prices will swing rapidly and violently. This is because there is a higher spread between the buy and sell prices, as there aren’t enough orders to go by. In addition to this, major market players like institutional investors and major banks will cease trading activities once the holiday-shortened week begins.
Typical Days of Market Closure
- New Year’s Day: Thursday, Jan. 1
- Martin Luther King Jr. Day: Monday, Jan. 19
- George Washington’s Birthday/Presidents’ Day: Monday, Feb. 16
- Good Friday: Friday, April 3
- Memorial Day: Monday, May 25
- Juneteenth: Friday, June 19
- Independence Day: Friday, July 3
- Labor Day: Monday, Sept. 7
- Thanksgiving Day: Thursday, Nov. 26
- Christmas Day: Friday, Dec. 25
On the above-mentioned holidays, the market remains closed no matter what. This is a peculiarity of the stock market when compared to the crypto market, which is open 24/7 year-round.
Trading Holiday Protocols and Order Persistence
Stock market holidays are interesting in many ways. The most frequently asked question about the market holiday is what happens to the open orders. During these holidays, since there is no activity permitted on the market, the orders that were not closed on the day before will remain open until the market opens the next day. No execution of orders takes place during this period.
Orders can, however, be opened on holidays as limit orders. These limit orders are called after-market orders (AMOs). These orders are placed in the queue for the market’s reopening day. Once the market is opened after the holiday period, these orders will be executed once they get matched on the order book. This means that even if there are two matching orders placed on a holiday, the trade will not be executed until the next trading day.
Since market volatility is a characteristic of the holiday period, the limit order may not be immediately executed once the market reopens. In such a situation, the limit order may remain non-executed until the conditions are met, or it will be cancelled as per the conditions of the limit order. For instance, a limit order placed as a good-till-cancelled order will remain on the order book until it is executed, whereas good-for-day (GFD) orders will be cancelled once the day’s trading ends and the limit order is not matched.
The Anatomy of a Market Gap
When a stock opens at a price significantly higher or lower than its previous close with no trading in between, it is called a gap. This pricing gap is an inherent risk associated with the stock market holidays. Traders must exercise caution during such periods to avoid excessive losses and even position liquidation for leveraged positions.
‘Note that while the market remains closed on a holiday, the world keeps moving as it is. The price gap happens on the stock market because significant news and events accumulate while the market is closed, and the pent-up supply and demand forces are all released at once when trading resumes.
Let us look at this scenario through an example: the closing price of an asset A was $100 the day before the holiday. On the holiday, significant news came about the company that was not particularly good for the company’s stock. At this moment, investors who realize that the stock’s price will fall will pool in with limit orders to buy the stock on the market. Similarly, traders who are holding the stock will put limit sell orders to reduce risk exposure. When the market opens the next day, there will be a visible gap once the limit orders start executing.
