Stocks Rise as House Lawmakers Get Ready to Vote: Markets Wrap
(Bloomberg) — Wall Street traders drove stocks higher and bond yields lower as House lawmakers are getting ready to vote to end a historic US government shutdown, which would unlock access to economic data that will be key in shaping the Federal Reserve outlook.
The resolution of the last four US shutdowns has spurred gains in the S&P 500 and most of its sectors, based on the median performance. While nearly 360 shares in the benchmark rose on Wednesday, the index edged only mildly higher amid a slide big tech. The advance in riskier assets also lifted the crypto world.
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Investors drove Treasuries higher across the curve on bets the Fed will have room to cut rates next month to prop up a weakening jobs market. Traders might get more clues on that front from the raft of central bank officials speaking on Wednesday.
“With the government shutdown delaying key economic data, the real challenge isn’t the short-term drag on growth — it’s the increasing difficulty for investors and the Fed to gauge the economic outlook,” said Seema Shah at Principal Asset Management. “However, as data releases resume, the case for a Fed rate cut in December should re-emerge, reinforcing a risk-on backdrop.”
House Speaker Mike Johnson said he believes the legislation, a hard-fought compromise forged in the Senate and blessed by President Donald Trump, will pass quickly. But he’ll have to keep his fractious party in line in the face of stiff opposition from House Democrats whose leaders are urging them to vote against the legislation.
The S&P 500 hovered near 6,850. A gauge of tech megacaps lost almost 1%. The yield on 10-year Treasuries declined five basis points to 4.07%. The dollar rose 0.2%.
Despite the added uncertainty around the shutdown, market impact has been limited, noted Adam Turnquist at LPL Financial. Since the shutdown began on Oct. 1, the S&P 500 has gained about 2%.
Historically, removing the uncertainty from a government shutdown tends to support equities, he said. Across the last 20 shutdowns since 1976, the S&P 500 has averaged gains of 1.2% and 2.9% in the one- and three-month periods following a budget resolution, compared to 0.8% and 2.4% during all periods over the same timeframe.
“While the markets are pricing the end of the government shutdown, there is an even bigger mountain ahead of us, and that is the resumption of all of the economic data that we have missed,” said Michael Landsberg at Landsberg Bennett Private Wealth Management. “As the fog lifts, we will see if market positioning has been correct and it is still clear sailing or if there is a big repricing necessary.”
With earnings season almost completely behind us, the market will be looking for clues about the Fed and how many rate cuts they can expect to see. The market will be looking for signals in the labor and inflation data to extrapolate what direction the Fed will go in and for how long, he said.
The imminent end of the government shutdown helps to calm worries about a slowdown, but the prospect that the US will continue to see robust growth is also being spurred by positive reports from the tech industry about the investment outlook in AI infrastructure, according to Thierry Wizman at Macquarie Group.
“We believe US stocks have further to run and expect the S&P 500 to hit 7,300 by June 2026,” said Mark Haefele at UBS Global Wealth Management. “Under-allocated investors should add exposure to our preferred areas, including the Transformational Innovation Opportunities of AI, Power and resources, and Longevity.”
Corporate Highlights:
Chevron Corp. chose West Texas as the site of its first project to provide natural gas-fired power to a data center, the beginning of a new line of business for the oil giant to capitalize on the boom in artificial intelligence. General Motors Co. has asked thousands of its suppliers to remove Chinese parts from their supply chains as the US carmaker looks to mitigate the risks of geopolitical disruptions, Reuters reported. Russian President Vladimir Putin signed an order allowing Citigroup Inc. to sell its bank inside the country to Renaissance Capital. Eli Lilly & Co. is dropping CVS Health Corp.’s drug benefit plan for its employees after CVS stopped covering its blockbuster weight-loss drug in favor of a rival medication from Novo Nordisk A/S, according to people familiar with the matter. Advanced Micro Devices Inc., Nvidia Corp.’s nearest rival in AI chips, predicted accelerating sales growth over the next five years, driven by strong demand for its data center products. Visa Inc. is testing the ability for businesses to send stablecoins directly to consumers’ cryptocurrency wallets for global payouts, targeting growing demand for the fiat-backed digital tokens among gig workers and digital creators in emerging markets. Circle Internet Group Inc. fell amid concern declining interest rates will weigh on returns going forward helped to offset higher-than-estimated revenue and earnings in the third quarter. Whoop Inc., the maker of popular screen-less fitness bands, is eyeing an initial public offering as soon as in the next two years and is exploring adding glucose monitoring to its health-tracking platform. Clearwater Analytics Holdings Inc. is considering a potential sale after receiving takeover interest, according to people familiar with the matter. Infineon Technologies AG forecast revenue will return to growth in the 2026 fiscal year, fueled by the global boom in artificial intelligence data centers. Siemens AG is finalizing options to reduce a majority stake in its former medical equipment unit after the €35 billion ($40.5 billion) holding turned into a drag on its share price. Bayer AG posted an improvement in profit, helped by surprising strength at its crop science business and demand for new drugs. Tata Steel Ltd.’s profit more than tripled for the second quarter on the strong performance of its Dutch operations and lower coking coal prices. Hon Hai Precision Industry Co. offered a rosy outlook for the year ahead, pointing to artificial intelligence development as its most important growth driver. Chinese discount online retailer Vipshop Holdings Ltd. is considering a listing in Hong Kong as soon as next year, according to people familiar with the situation. Some of the main moves in markets:
Stocks
The S&P 500 was little changed as of 9:49 a.m. New York time The Nasdaq 100 fell 0.2% The Dow Jones Industrial Average rose 0.8% The Stoxx Europe 600 rose 0.8% The MSCI World Index rose 0.2% Bloomberg Magnificent 7 Total Return Index fell 0.9% The Russell 2000 Index rose 0.6% Currencies
The Bloomberg Dollar Spot Index rose 0.2% The euro was little changed at $1.1573 The British pound fell 0.4% to $1.3098 The Japanese yen fell 0.5% to 154.92 per dollar Cryptocurrencies
Bitcoin rose 1.2% to $103,872.98 Ether rose 2.4% to $3,497.69 Bonds
The yield on 10-year Treasuries declined five basis points to 4.07% Germany’s 10-year yield declined one basis point to 2.65% Britain’s 10-year yield advanced two basis points to 4.40% The yield on 2-year Treasuries declined three basis points to 3.56% The yield on 30-year Treasuries declined four basis points to 4.67% Commodities
West Texas Intermediate crude fell 2.9% to $59.25 a barrel Spot gold rose 0.2% to $4,133.47 an ounce ©2025 Bloomberg L.P.
