Live Updates: Stock Futures Dip Amid Government Shutdown – What It Means for Investors

Traders at the New York Stock Exchange saw a dip in stock futures as the U.S. government entered a shutdown on Wednesday morning. Futures for the Dow fell by 192 points, indicating a 0.41% decline. S&P and Nasdaq 100 futures also dropped, reflecting growing investor concern.

The shutdown occurred after the Republican-controlled Senate could not pass a temporary spending bill. Democrats aimed to extend health care tax credits for many Americans through this bill. According to the nonpartisan Congressional Budget Office, around 750,000 federal employees might be furloughed during this period.

President Trump labeled the shutdown “probable,” assigning blame to Democrats for their lack of compromise. Historically, the stock market has often weathered government shutdowns. However, this shutdown carries unique risks due to current economic pressures such as a slowing labor market and high inflation.

Mark Luschini, a chief investment strategist at Janney Montgomery Scott, expressed concerns about the lack of economic data due to the shutdown. Important reports, like the Labor Department’s jobs report, won’t be released, leaving investors to rely on other indicators, like private job creation data expected from ADP.

Interestingly, past shutdowns usually resulted in stock market gains. For instance, studies show that the S&P 500, MidCap 400, and Small Cap 600 saw average increases of over 3% during previous shutdowns. In fact, major U.S. indexes ended positively before the shutdown, contributing to a strong September performance with the S&P 500 up by 7.8% in the third quarter.

In a related positive note, shares of Nike surged more than 4% in after-hours trading, as the company exceeded earnings and revenue expectations for its fiscal first quarter. As investors keep a close eye on the unfolding situation, the focus now shifts to how long the shutdown lasts and its potential impacts on the economy and job market.



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