“Life starts all over again when it gets crisp in the fall.”
-F. Scott Fitzgerald
Here’s what you need to know this week:
- Stocks fall as government shutdown anxieties escalate…
- And then promptly rebound as a deal takes shape
Shutdown Selloff
Stocks continued their slide last week as problems continued to pile up from the government shutdown. Government employees continue to work without pay, welfare payments have been slashed and key economic reports continue to miss deadlines. Investors have increasingly turned to alternative data provided by private companies to fill in the gaps.
In lieu of the nonfarm payrolls (NFP) report usually released by the Bureau of Labor Statistics, analysts are piecing together pieces from multiple companies. Revelio Labs releases their own monthly estimate of the change in nonfarm employment, and this month’s report showed a slight decline in the labor force:
Additionally, the hiring website Indeed showed that active job postings on their site have hit the lowest point since 2021:
However, the biggest economic disruption from the government shutdown has come in the form of air travel. Flight delays and cancelations have risen dramatically as air traffic controllers have either resigned or refused to work without pay, and roughly 10% of all domestic flights have been canceled over the past week.Air traffic disruptions eventually convinced Congress to end the previous longest shutdown (35 days) in 2018, and it appears this shutdown is headed for the same fate:
Reopening Rally
Stocks have risen dramatically this week and are within 1% of all-time highs on the news that Congress is nearing a deal to reopen the government. Seven Senate Democrats and one Independent voted with the 52 Republican Senators to reopen the government, narrowly clearing the 60-vote threshold[1]. Democrats had previously refused to vote “yes” until Republicans agreed to extend healthcare subsidies for the 42 million Americans receiving health insurance through the Affordable Care Act marketplace, but the seven Democrats and one Independent crossed the aisle on promises from Republicans to extend the ACA subsidies once the government reopens.
The bill now moves to the House of Representatives and a vote is likely to come later today. The vote is expected to be quite close: most, if not all, Democrats are expected to vote “no” and the Republicans hold a razor-thin majority of just two votes. Political analysts expect the bill to pass narrowly, and President Trump has already committed to sign the bill if it passes[2]. No one knows for sure what will happen but stocks are behaving as if an end to the shutdown is imminent.
What Else
- Israel has continued bombing Gaza despite growing condemnation from other countries
- Russia made their largest advance into Ukraine in more than two years over the weekend
- COP30, the largest international climate conference, kicked off in Brazil on Monday
- Legendary actress Sally Kirkland passed away at the age of 84
- The NBA began their in-season tournament last Friday
What We’re Reading
Scared of spiders? Then you may want to avoid reading this week’s article. Biologists investigating Sulphur Cave, a large cave on the border of Greece and Albania, discovered the world’s largest recorded spiderweb in history. The web measures 106 square meters and is estimated to contain 111,000 spiders. Click below to read more about this discovery and to see photos of this incredible web:
What’s Happening Downtown
The Oklahoma City Tree Lighting Festival takes place tomorrow evening in Bricktown from 5:30 to 7:30 PM. The festival features free photos with Santa, face painting, live music and food from eleven different Bricktown restaurants. Click below to learn more:
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Written by: Kane Ogle, CFP®
Steve Beck, Kane Ogle, CFP®, Amber Eduvigen, CFP®, Cale Olbert, CFP®, Brett Valentine, CFP®, Brandon Ingerson, Bill Daniel, Sam Postich, Jenni Hess