U.S. stock index futures were pointing slightly higher on Friday, suggesting equities could extend the winning streak that has carried the major averages to fresh record highs this week despite the continued government shutdown in Washington.
Shutdown Concerns vs. Market Optimism
Investors appear largely unfazed by the political gridlock, even though Treasury Secretary Scott Bessent has cautioned that the standoff could dent economic growth.
“This isn’t the way to have a discussion, shutting down the government and lowering the GDP,” Bessent told CNBC’s Squawk Box. “We could see a hit to the GDP, a hit to growth and a hit to working America.”
More immediate for traders is the impact on data releases. The Labor Department’s monthly jobs report—originally due Friday—has been delayed because of the shutdown.
“There is growing expectation that the shutdown in Washington might continue until mid-October, with the scheduled jobs report due out today unlikely to be released,” said Russ Mould, investment director at AJ Bell.
He added, “How long investors remain relaxed about this state of affairs remains hard to predict, but one worry is that it makes it significantly harder for the Federal Reserve to make informed decisions around interest rates.”
Wall Street Rally Continues
On Thursday, stocks wavered before closing mostly higher, notching a fifth straight day of gains. The Nasdaq added 88.89 points, or 0.4%, to 22,844.05. The Dow advanced 78.62 points, or 0.2%, to 46,519.72, and the S&P 500 edged up 4.15 points, or 0.1%, to 6,715.35.
Tech stocks once again drove the advance, fueled by enthusiasm over artificial intelligence. Nvidia (NASDAQ:NVDA) slipped from session highs but still gained 0.9% to another record close, while Advanced Micro Devices (NASDAQ:AMD) rallied 3.5%.
The rally came as OpenAI was reported to have finalized a deal that values the ChatGPT developer at $500 billion. With $6.6 billion worth of shares sold by employees and former staff, the company is now considered the world’s most valuable privately held firm, overtaking SpaceX.
“Reports suggest there was appetite for nearly twice as many as the actual number of shares on offer,” Mould noted.
Politics and Policy
The shutdown entered its second day Thursday, with little progress toward resolution. The Senate, which adjourned for Yom Kippur without holding votes, is set to reconvene Friday to consider competing funding proposals.
Meanwhile, President Donald Trump cast the standoff as advantageous, writing on Truth Social that it gives him an “unprecedented opportunity” to reduce agencies favored by Democrats.
As a result of the funding lapse, reports on weekly jobless claims and factory orders were also postponed indefinitely.
Sector Movers
Semiconductor names stood out again, with the Philadelphia Semiconductor Index jumping 1.9% to a record close. Airlines also climbed, as the NYSE Arca Airline Index rose 1.2% after hitting a two-month low earlier in the week.
By contrast, weakness in oil prices weighed on energy shares. The Philadelphia Oil Service Index dropped 2.5%, while the NYSE Arca Oil Index lost 1.2%. Pharmaceutical companies also retreated, with the NYSE Arca Pharmaceutical Index falling 1% after a two-day rally.
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