Arincen - US stocks opened lower on Tuesday amid growing fears of a potential government shutdown, as the deadline approaches for passing the necessary funding to keep federal agencies operating.
This development comes at a time when investors are closely watching statements from Federal Reserve officials for clearer signals about the path of monetary policy in the upcoming period.
The Dow Jones Industrial Average recorded a slight decline of 0.1%, equivalent to 35 points, reaching a level of 46281 points.
In contrast, the S&P 500 index fell by 0.2%, recording 6650 points, while the NASDAQ composite index continued its losses by 0.3% to reach 22518 points, reflecting the prevailing caution in the markets.
According to CNBC, fears of a government shutdown add a new burden on markets that are already facing other challenges, most notably a slowdown in the labor market, the risk of entering a stagflationary state, along with concerns about the significant rise in valuations of U.S. stocks in recent months.
In the political scene, U.S. House Speaker Mike Johnson expressed his doubts about the possibility of reaching an agreement among lawmakers before the deadline to avoid a shutdown.
Vice President J.D. Vance stated that the government is indeed heading towards a shutdown, following a meeting that brought together former President Donald Trump with leaders of both the Republican and Democratic parties, increasing the atmosphere of political ambiguity and uncertainty.
On the economic side, investors are awaiting statements from several Federal Reserve officials later today, amidst hopes that these statements will carry hints about future interest rates for the remainder of 2025, which could directly impact investor sentiment and market trends in the coming period.
