Record Highs for Major Market Indexes Amidst Government Shutdown
Despite concerns surrounding the ongoing federal government shutdown, U.S. stock markets have defied expectations. On Thursday, all three major indexes closed at record highs. Investors seem to be focusing on strong corporate earnings and the momentum within the AI sector.
The S&P 500 gained 0.06% to reach 6,715.35, while the Nasdaq Composite jumped 0.39% to finish at 22,844.05. The Dow Jones Industrial Average also saw an increase, climbing 0.17% to close at 46,519.72.
The tech-heavy Nasdaq was particularly boosted by continued gains in artificial intelligence stocks. Nvidia, for instance, reached new all-time highs. This suggests that investors remain optimistic about AI infrastructure investments.
This rally occurred despite the government shutdown entering its second day. The shutdown has delayed key economic data releases, including the crucial September jobs report. Treasury Secretary Scott Bessent warned that GDP may “see a hit” from the shutdown. However, market strategists have remained largely unfazed.
Tom Lee of Fundstrat Global Advisors noted that past shutdowns have had little lasting impact on equities. He expects the S&P 500 to reach at least 7,000 by December, with potential for further gains.
The Federal Reserve is still expected to announce an interest rate cut at its upcoming October meeting. Recent ADP data, showing a drop in private payrolls, supports the case for monetary easing.
Source: CNBC