Home Stocks Investors Push S&P 500 to New All-Time Peak, Brushing Off Shutdown Risks

Investors Push S&P 500 to New All-Time Peak, Brushing Off Shutdown Risks

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S&P 500, Dow and Nasdaq Hit Record Highs Despite Shutdown

The S&P 500, Dow Jones, and Nasdaq all reached new all-time highs on Friday, shrugging off concerns over a slowing economy and an ongoing U.S. government shutdown that delayed the release of payroll data.

Major Indexes Climb to Records

By 12:55 p.m. ET (17:56 GMT), the Dow Jones Industrial Average rose 522 points, or 1.1%. The S&P 500 gained 0.4%, while the Nasdaq Composite added 0.2%. All three benchmarks touched record intraday highs.

Markets remain supported by optimism around artificial intelligence and expectations of further Federal Reserve rate cuts. Analysts suggest these drivers continue to outweigh short-term economic concerns.

Government Shutdown Risks

Treasury Secretary Scott Bessent warned the shutdown could damage the economy more than past episodes. The last shutdown, during Trump’s first term, lasted 35 days and cost the economy about $11 billion, according to the Congressional Budget Office.

Analysts at Capital Economics argued that while shutdowns usually have limited market impact, a weakening labor market poses greater risks. They pointed to downside pressures for equities, the dollar, and U.S. Treasury yields.

Services Sector Stalls

The shutdown has delayed the release of the September nonfarm payrolls report. The Federal Reserve is closely monitoring labor conditions as it considers further rate reductions.

Recent data sent mixed signals. Challenger layoffs fell in September, while ADP data showed private payrolls dropped sharply. The ISM non-manufacturing PMI fell to 50.0 in September, down from 52.0 in August, signaling stalled growth in the services sector.

Since services represent over two-thirds of U.S. economic activity, analysts see the slowdown as another sign of weakening demand and hiring pressures.

Corporate Movers

In corporate news:

  • Applied Materials (NASDAQ:AMAT) dropped after warning new U.S. export restrictions would cut revenue by $110 million in Q4 and $600 million in fiscal 2026.
  • Palantir Technologies (NASDAQ:PLTR) slipped after reports flagged security flaws in a U.S. Army battlefield communication network built with its technology.
  • USA Rare Earth (NASDAQ:USAR) rallied to a record high after CEO Barbara Humpton said the firm was in talks with the Trump administration.
  • Entergy Corporation (NYSE:ETR) announced it will supply power for Google’s planned $4 billion data center in Arkansas.

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