The government shutdown is finally over after President Trump signed a bill reopening Washington for business late in the week. This means that a number of reports that were postponed because of a lack of government funding are likely to be issued at some point in the coming days.
The Bureau of Labor Statistics (BLS) is scheduled to release the September jobs report on Thursday. It’s worth noting that the figures may be incomplete or an estimate as not all data has been collected or thoroughly analyzed. The BLS also warns that the October jobs report that was due out earlier in November may not be released at all because of a lack of information.
As part of the bill, all federal workers who worked without pay will receive retroactive compensation. Furthermore, thousands of workers who were terminated or facing termination will either be reinstated or have their terminations cancelled.
The reopening of the government will likely cause some short-term chaos as states will need time to send out SNAP benefits and other benefits delayed by the lack of funding. In addition, it may take time for airports to get back to full capacity as air traffic controllers slowly return to work. It’s estimated that the shutdown will ultimately result in a 0.1 percent to 0.2 percent drop in current quarter gross domestic product.
One of the silver linings is that the government will be collecting inflation, employment and other important data going forward. This will likely provide some clarity for the Fed as they decide whether further rate cuts are warranted as the year comes to a close.
The S&P 500 was relatively quiet in spite of the end of the shutdown. For the week, the index was down 66 points, which is a loss of about 1 percent, to close at 6,738. Despite the pullback, the market is still up about 2 percent over the past month and is up more than 13 percent over the past 12 months. Over the last five days, the market made a high of 6,863 on Wednesday and a low of 6,660 on Friday morning.
The Dow was flat this week finishing down 39 points, which was a drop of about 0.08 percent. At the close of trading Friday, the index was at 47,171, which is still near yearly and all-time highs. On Wednesday, the market made its high of the week peaking at 48,369 while it made a low of 46,923 on Friday.
Finally, the Nasdaq was the most volatile market this week falling 429 points to close at 25,007. This was a loss of 1.69 percent for an index that is up nearly 20 percent over the past 12 months. However, in the short-term, questions about AI and other economic headwinds may cause some volatility that must be navigated.
Internationally, Australia announced on Wednesday that its economy added 42,000 jobs over the last month, and the country’s unemployment rate is 4.3 percent. On Thursday morning, Great Britain announced that its GDP dropped 0.1 percent over the past month. Switzerland announced that it had reached a deal to lower export tariffs from 39 percent to 15 percent. In addition, the country would invest $200 billion in the United States by 2028.
The upcoming week is going to feel more like normal as a number of reports will be issued. In addition to the September jobs reports, the Fed will be releasing the minutes from its most recent meeting. Friday, the Flash Manufacturing PMI and Flash Services PMI will be released. Unemployment claims numbers for the week will likely be released on Thursday assuming that sufficient data has been collected.