The major U.S. index futures are indicating a modestly higher open on Friday, suggesting that stocks are set to continue the trend observed in recent sessions. The markets might persist in reaping the rewards of recent upward momentum, which has propelled the major averages to unprecedented record highs, even in the face of the ongoing U.S. government shutdown. Traders appear to have dismissed worries regarding the economic repercussions of the shutdown, despite Treasury Secretary Scott Bessent’s caution that it could negatively affect U.S. economic growth. “This isn’t the way to have a discussion, shutting down the government and lowering the GDP,” Bessent said in an interview, “We could see a hit to the GDP, a hit to growth and a hit to working America.”
The potential for a more significant impact on the markets may stem from the postponement of the release of crucial U.S. economic data, including the Labor Department’s highly scrutinized monthly jobs report that was set to be unveiled this morning. “There is growing expectation that the shutdown in Washington might continue until mid-October, with the scheduled jobs report due out today unlikely to be released,” said AJ Bell. He added, “How long investors remain relaxed about this state of affairs remains hard to predict, but one worry is that it makes it significantly harder for the Federal Reserve to make informed decisions around interest rates.” Stocks experienced fluctuations throughout the trading session on Thursday, ultimately concluding the day predominantly in positive territory. The major averages advanced, closing higher for the fifth consecutive session and achieving new record closing highs. The major averages concluded the day in positive territory. The Nasdaq increased by 88.89 points, representing a 0.4 percent rise, reaching 22,844.05. The Dow gained 78.62 points, or 0.2 percent, closing at 46,519.72. Meanwhile, the S&P 500 edged up 4.15 points, a 0.1 percent increase, to settle at 6,715.35.
The ongoing rise of the major averages was, in part, a reflection of optimism surrounding the artificial intelligence sector, which bolstered the performance of technology stocks. Nvidia, a prominent figure in the AI sector, experienced a slight pullback from its peak but still managed to rise by 0.9 percent, achieving a record closing high. Meanwhile, Advanced Micro Devices, another key player in the AI arena, saw a notable increase of 3.5 percent. The surge in AI stocks followed reports that OpenAI has finalized a deal valuing the company at $500 billion. The ChatGPT owner has eclipsed Elon Musk’s SpaceX as the world’s most valuable privately-owned company, following the sale of approximately $6.6 billion worth of stock by current and former employees. “Reports suggest there was appetite for nearly twice as many as the actual number of shares on offer,” said Russ Mould. Meanwhile, traders persisted in dismissing worries regarding the economic ramifications of the ongoing U.S. government shutdown, which has now entered its second day without indications of a forthcoming resolution. The Senate adjourned without holding votes Thursday in observance of the Yom Kippur holiday and will reconvene on Friday to vote once more on Republican and Democratic funding bills that have previously not succeeded. President Donald Trump aimed to present the shutdown in a favorable manner in a post on Truth Social, asserting that it provides him with a “unprecedented opportunity” to reduce federal agencies supported by Democrats.
The shutdown has led to the indefinite postponement of the reports on weekly jobless claims and factory orders that were set to be released on Thursday morning. Semiconductor stocks delivered a robust performance on the day, fueled by optimism surrounding AI, propelling the Philadelphia Semiconductor Index up by 1.9 percent to a record closing high. Airline stocks demonstrated notable strength, evidenced by the 1.2 percent gain recorded by the NYSE Arca Airline Index. The index rebounded from its lowest closing level in nearly two months. Conversely, energy stocks declined in tandem with the price of crude oil, resulting in a 2.5 percent drop in the Philadelphia Oil Service Index and a 1.2 percent decrease in the NYSE Arca Oil Index. Pharmaceutical stocks experienced a decline after a two-day surge, leading to a 1.0 percent loss in the NYSE Arca Pharmaceutical Index.