The professional trader works in a booth on the floor of the New York Stock Exchange on September 10, 2025.
Brendan McDermid | Reuters
Inventory futures fell on Tuesday as the U.S. government was on the verge of a potential shutdown. Despite the latest decline, Wall Street was heading for an unusually strong September.
Futures linked to the Dow Jones Industrial Average It fell 127 points, or 0.3%. S&P futures 0.2% slipped Nasdaq-100 Futures.
Shutdowns are not usually market-driven events, but this time it could be different as investors are already wary of slower labor markets, risk of stagflation and rising stock valuations. The closure could also encourage rating agencies to rethink the state of US credit, which was downgraded by Moody’s in May.
“I think we’re heading towards closure because Democrats aren’t doing the right thing,” Vice President JD Vance said Monday evening after a meeting between President Donald Trump and Democrats and Republicans.
The Labor Bureau also announced Monday that its September non-farm salary report, scheduled to be released Friday, will not be released if the U.S. government shuts down its operations. This report is one of several upcoming major data releases that provide important information on the economic direction ahead of the Federal Reserve’s upcoming October policy meeting. The growing concern over the closure was the threat of President Donald Trump over the weekend, that the closure could lead to mass shootings of federal workers.
Jack Janasiewicz, lead portfolio strategist and portfolio manager at Natixis Investment Managers, said government closures could lead to “tangent effects” in short-term market sentiment and volatility.
“Laser delays in collecting economic data due to closures, which are keenly aware of risks to the softened labor market, while also focusing on signs of tariff pass-through on inflation, can lead to increased uncertainty.
“Is such uncertainty likely to halt the economic background and, as a result, become greater as the assets come with risk? It’s probably not a permanent effect, but the longer the uncertainty, the higher the risk,” he said.
Reflecting that view, Adam Crisafulli has important knowledge. This predicts that if it lasts longer than a significant amount of time, the closure will shave off market sentiment. Government closures are not often longer than two weeks.
“When it comes to Washington, investors have been sitting tight for the very moment, as the market was widely expected to close, but if this is extended beyond two weeks, people will start to become more worried,” the company founder said.
Strong September
Major US stock indexes continue to hover near record highs ahead of the final September session. The S&P 500, which averaged 4.2% monthly decline over the past five years, has increased by more than 3% this month.
Additionally, the Dow Jones industrial average has increased by 1.7%. Tech Heavy Nasdaq Composite outperforms the other two benchmark indices with a profit of around 5.3% in September.
Tuesday also marks the end of the third quarter. The broad index has so far risen in the 7.4% quarter, but NASDAQ reaches nearly 11% of its near-quarter gain. The Dow has grown 1.7% over three months, marking its fifth positive quarter for a rundown.
