Stock market today: S&P 500 in another closing record despite ongoing shutdown

Investing.com-- The S&P 500 clinhed another closing record Thursday, but upside was kept in check amid concerns that the government shutdown isn’t likely to be short-lived.

At 4:00 p.m. ET (20:00 GMT), the Dow Jones Industrial Average traded 0.2% higher. while the S&P 500 index rose 0.1% to a fresh closing record of 6,715.80, while the NASDAQ Composite rose 0.4%. 

U.S. economy may ’see a hit’ from shutdown, Treasury Secretary Bessent warns 

In an interview with CNBC, Treasury Secretary Scott Bessent warned that this shutdown, which begin on Tuesday midnight, could be leave a bigger mark on the economy than that of prior shutdowns. 

"We could see a hit to the GDP, a hit to growth, and a hit to working America," Bessent said. 

The shutdown is expected to disrupt services ranging from air traffic control to disaster relief are expected to be disrupted, while key nonfarm payrolls data due on Friday is also expected to be delayed.

It remained unclear just how long the shutdown will last, given that Democrats and Republicans in the Senate appeared no closer to reaching consensus on a spending bill.  

President Donald Trump added to the divide by threatening to cut off funding for Democrat-leaning states and fire scores of federal workers permanently. 

Shutdowns have historically had limited impact on financial markets and the economy. The last shutdown occurred during Trump’s first term– for a span of 35 days between late-2018 and early-2019– and was the longest in U.S. history.  

The shutdown cost the economy about $11 billion, the Congressional Budget Office estimated. 

The betting website Polymarket indicates the highest likelihood that the standoff will last between one or two weeks, though there is currently a 34% probability of a longer shutdown, with just over $1.2 million wagered.

Labor market in spotlight 

One key consequence of the continuing U.S. government shutdown has been the potential delay to the release of key economic indicators, including the monthly nonfarm payrolls report slated for Friday.

That means that other private figures, such as Thursday’s Challenger layoffs data, have received more attention than usual.

There was some good news from that front, as layoffs announced by U.S. employers fell in September. Global outplacement firm Challenger, Gray & Christmas said on Thursday that planned job cuts decreased 37% to 54,064 last month. It is down by 26% from the same month a year ago.

Additionally, the U.S. unemployment rate likely was 4.3% in September, unchanged from August, according to a new "real-time" estimate from the Federal Reserve Bank of Chicago published on Thursday.

It was only the second time the regional Fed bank has published its new metric, which is based on the government’s Current Population Survey as well as data from non-government sources such as the online job site Indeed and Google.

However, earlier this week, the ADP National Employment Report showed the largest decline in private payrolls in two-and-a-half years during September. 

The Fed has been keeping close tabs on labor market numbers as officials assess the outlook for monetary policy. Borrowing costs were reduced by 25 basis points last month, with policymakers highlighting the need to prioritize supporting a flagging jobs picture over sticky inflationary pressures.

The weak economic prints have driven persistent bets that the Federal Reserve will continue to cut interest rates in the two remaining policy meetings left this year.

Tesla posts surprise deliveries growth in Q3, Rivian narrows guidance

Tesla (NASDAQ:TSLA) stock fell even as the EV maker saw deliveries bounce back in Q3 as the prospect of softer demand looms with the EV tax credit set to expire.    

Despite the incoming hit to demand this was "great bounceback quarter for Tesla to lay the groundwork for deliveries moving forward," WEdbush said, though added there was  "still work to do to gain further ground from a delivery perspective."

In the corporate sector, Rivian Automotive (NASDAQ:RIVN) reported a nearly 32% surge in third-quarter deliveries, beating analysts’ estimates, as more U.S. car buyers rushed to secure tax credits before their expiry by purchasing new electric vehicles.

Occidental Petroleum (NYSE:OXY) shares fell after the company announced it would sell its chemical division, OxyChem, to Warren Buffett’s Berkshire Hathaway (NYSE:BRKb) for $9.7 billion in cash.

Stellantis (NYSE:STLA) stock surged after Morgan Stanley said the carmaker is showing a long-awaited turnaround in market share, with U.S. sales momentum strengthening in September.

Elsewhere, OpenAI was valued at $500 billion after a secondary share sale worth about $6.6 billion, according to various news reports citing sources familiar with the matter.

The deal makes the ChatGPT-maker the world’s most valuable startup, surpassing Elon Musk’s rocket firm SpaceX, which was recently valued at about $400 billion.

Peter Nurse, Ambar Warrick contributed to his article