U.S. Stocks Hold Steady as Investors Look Past Shutdown
U.S. stocks steadied on Thursday, with the S&P 500 index at record highs, as investors focused on the possibility of more Federal Reserve interest rate cuts and largely brushed off concerns about the ongoing government shutdown.
Market Snapshot
At 09:31 ET (13:31 GMT):
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The Dow Jones Industrial Average traded flat.
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The S&P 500 gained 15 points (0.2%).
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The NASDAQ Composite rose 130 points (0.6%).
Government Shutdown Impact
The U.S. government shutdown began after Congress failed to approve funding. Key services, including air traffic control and disaster relief, are facing disruptions. The nonfarm payrolls report, expected Friday, will likely be delayed.
President Donald Trump escalated tensions by threatening to cut funding for Democrat-leaning states and permanently fire federal workers. Shutdowns have historically had limited market impact, though the longest one in 2018–2019 cost the U.S. economy about $11 billion.
Betting markets on Polymarket suggest the shutdown could last one to two weeks, with a 34% chance of going longer.
Labor Market in Focus
The shutdown could delay major labor market reports, pushing investors to focus on private data. Challenger, Gray & Christmas reported that layoffs fell 37% in September, down 26% from last year.
The Chicago Fed estimated the unemployment rate at 4.3% in September, unchanged from August, based on real-time indicators such as job postings.
However, earlier this week, the ADP report showed the steepest drop in private payrolls in two-and-a-half years. With signs of a weakening labor market, the Fed is expected to continue rate cuts in its final two meetings of 2025.
Corporate Highlights
- Rivian Automotive (NASDAQ:RIVN) reported a 32% jump in Q3 deliveries, beating estimates as buyers sought EV tax credits.
- Occidental Petroleum (NYSE:OXY) rose after announcing it will sell its chemical unit OxyChem to Berkshire Hathaway (NYSE:BRKb) for $9.7 billion.
- Tesla (NASDAQ:TSLA) gained ahead of its Q3 delivery report, though analysts warned tax credit expiries may have pulled demand forward.
- Stellantis (NYSE:STLA) surged after Morgan Stanley noted a long-awaited turnaround in U.S. market share.
- OpenAI was valued at $500 billion after a $6.6 billion secondary share sale, making it the world’s most valuable startup, surpassing SpaceX.
Oil Prices Extend Losses
Crude oil prices slipped again on Thursday:
- Brent fell 0.9% to $64.79 a barrel.
- WTI dropped 0.9% to $61.22 a barrel.
Both benchmarks lost around 1% in the prior session, hitting their lowest levels since May and June.
The G7 finance ministers pledged to increase pressure on Russia by targeting buyers of its crude. Meanwhile, concerns about higher OPEC+ production and the ongoing U.S. shutdown have weighed on sentiment.
