Stock Market Today: Stocks Waver as Government Shutdown Looms
Rising yields, higher oil prices and Washington's march toward its first shutdown since 2019 sapped risk appetite.


Stocks rebounded to close mixed Tuesday but not before market participants spent the majority of the session continuing to fret about higher for longer interest rates, rising bond yields, a spike in prices for crude oil and the reality that the federal government is hurtling toward its first shutdown since 2019.
A stronger-than-expected reading on U.S. manufacturing activity did offer an economic bright spot on Tuesday. Orders for long-lasting U.S. manufactured goods easily topped economists' estimates for August. The resilience in orders for durable goods was driven by "strong business investment spending and robust defense expenditures," writes José Torres, senior economist at Interactive Brokers.
Markets spent almost the entire session preoccupied with more downbeat developments, however. In addition to mounting anxiety about rising Treasury yields and a resurgent U.S. dollar, Torres noted that the autoworkers strike is taking an increasing toll on market sentiment.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"The ongoing UAW strike against the Big Three automakers is also adding to investor anxiety about wage pressures, inflation, and the health of supply chains," Torres notes.
Meanwhile, oil prices continued their ascent Tuesday, adding to worries about inflation but making winners out of select energy names. U.S. benchmark West Texas Intermediate crude oil futures rose 3.6%. Among the day's biggest gainers were Occidental Petroleum (OXY), ConocoPhillips (COP) and Exxon Mobil (XOM).
At the closing bell, the blue chip Dow Jones Industrial Average slipped 0.2% to 33,550, while the broader S&P 500 was essentially unchanged at 4,274. The tech-heavy Nasdaq Composite added 0.2% to finish at 13,092.
Shutdowns aren't necessarily bad for stocks
The federal government is fast approaching the October 1 deadline when it will begin shutting down. This is not good economic news, at least not in the shorter term.
"A shutdown, if it happens, would ding GDP growth in the fourth quarter, to the tune of 0.2% of GDP for every week it lasts, as nonessential federal agencies halt work and their employees go unpaid," writes David Payne, Kiplinger staff economist. "However, whenever the shutdown ends, federal workers are likely to get back pay, which would boost growth in early 2024."
Either way, historically it turns out that government shutdowns haven't been particularly bearish for stocks. During the 21 government shutdowns since 1976, the S&P 500 rose 55% of the time, generating an average return of 0.3%, according to data from Carson Group. Even better, 12 months after the end of the shutdown, the S&P 500 was higher 86% of the time, with an average return of 12.7%.
It's tough to remember now, but the S&P 500 returned 10.3% during the 35-day shutdown of 2018-2019. Stocks did fine during the extended shutdown of October 2013 too.
Related content

Dan Burrows is Kiplinger's senior investing writer, having joined the august publication full time in 2016.
A long-time financial journalist, Dan is a veteran of SmartMoney, MarketWatch, CBS MoneyWatch, InvestorPlace and DailyFinance. He has written for The Wall Street Journal, Bloomberg, Consumer Reports, Senior Executive and Boston magazine, and his stories have appeared in the New York Daily News, the San Jose Mercury News and Investor's Business Daily, among other publications. As a senior writer at AOL's DailyFinance, Dan reported market news from the floor of the New York Stock Exchange and hosted a weekly video segment on equities.
Once upon a time – before his days as a financial reporter and assistant financial editor at legendary fashion trade paper Women's Wear Daily – Dan worked for Spy magazine, scribbled away at Time Inc. and contributed to Maxim magazine back when lad mags were a thing. He's also written for Esquire magazine's Dubious Achievements Awards.
In his current role at Kiplinger, Dan writes about equities, fixed income, currencies, commodities, funds, macroeconomics, demographics, real estate, cost of living indexes and more.
Dan holds a bachelor's degree from Oberlin College and a master's degree from Columbia University.
Disclosure: Dan does not trade stocks or other securities. Rather, he dollar-cost averages into cheap funds and index funds and holds them forever in tax-advantaged accounts.
-
Alaska Airlines to Buy Hawaiian: Get Bonus Miles Now
How to use the Alaska Airlines credit card and frequent flyer program to save on trips to Hawaii, Alaska and beyond.
By Ellen Kennedy Published
-
11 Reasons to Consider a 1031 Exchange
Deferring capital gains taxes might be at the top of the list, but growing your portfolio and your wealth and helping with estate planning are also compelling reasons.
By Daniel Goodwin Published
-
Stock Market Today: Stocks Swing Lower as Oil Prices Retreat
A bad-news-is-good-news jobs report sent the main indexes higher at the open, but they didn't stay there for long.
By Karee Venema Published
-
Stock Market Today: Stocks Struggle, Apple Reclaims $3 Trillion Market Cap Mark
Apple quietly reclaimed the $3 trillion market cap level Tuesday amid a choppy day for the main indexes.
By Karee Venema Published
-
Stock Market Today: Stocks Slip to Start Jobs Week
Coming off a fifth straight weekly win, the main indexes took a breather ahead of a busy week of jobs data.
By Karee Venema Published
-
Stock Market Today: Stocks Swing Higher After Powell Speech
Fed Chair Powell poured cold water on potential rate cuts, but stocks jumped anyway.
By Karee Venema Published
-
Stock Market Today: Dow Jumps 520 Points After Salesforce Earnings
The enterprise network software firm reported impressive Q3 results, sending the blue chip stock soaring.
By Karee Venema Published
-
Stock Market Today: Stocks Give Back GDP Gains After Beige Book
The latest GDP report showed the U.S. economy grew at a rapid-fire rate in the third quarter, but the Fed's Beige Book sparked concerns.
By Karee Venema Published
-
Stock Market Today: Stocks Struggle for Direction After Mixed Fed Messages
E-commerce platform PDD Holdings jumped after earnings, while rival Shein reportedly filed confidential IPO paperwork.
By Karee Venema Published
-
Stock Market Today: Stocks Close Lower on Cyber Monday
The main indexes were choppy to start the week, though several e-commerce stocks jumped on encouraging online holiday shopping numbers.
By Karee Venema Published