U.S. Stock Market Rallies Amid Looming Government Shutdown Concerns

The U.S. stock market closed higher on September 29, overcoming heightened fears of an impending federal government shutdown. Sustained momentum in tech stocks and a shift toward safe-haven assets drove major indices to finish the day in positive territory.

The Dow Jones Industrial Average gained 68.78 points, or 0.15%, ending at 46,316.07. The S&P 500 climbed 17.51 points, or 0.26%, to close at 6,661.21. Meanwhile, the Nasdaq Composite Index—the session's standout performer—rose by 107.09 points, or 0.48%, to reach 22,591.15. The tech-heavy Nasdaq posted the strongest percentage gain among the three major indices, reflecting robust buying activity across technology stocks.

Shutdown Probability Surpasses 60%, Delayed Economic Data Likely

Investor sentiment remained cautious due to the growing likelihood of a federal government shutdown, slated for early October. Budget negotiations between President Donald Trump and Congressional leaders saw minimal progress, according to Democratic representatives. Prediction platform Polymarket placed the chance of a shutdown at over 60%, signaling heightened political risk.

A potential shutdown could disrupt the Bureau of Labor Statistics' (BLS) operations, leading to delays in the release of critical economic data, including the highly anticipated employment report, the Consumer Price Index (CPI), and the Producer Price Index (PPI). Analysts noted that September’s nonfarm payroll figures, originally scheduled for release this Friday, would likely be postponed. Investors fear that the absence of key economic metrics could create uncertainty around Federal Reserve monetary policy decisions.

Despite these risks, the tech sector continued to attract sustained buying interest, bolstered by stronger-than-expected economic data and the prospect of interest rate cuts. Such developments have helped restore confidence among investors despite looming uncertainties.

Safe-Haven Assets Surge: Gold Hits Historic Highs

Rising market anxieties around the shutdown spurred demand for safe-haven assets. Gold futures soared 1.2% to settle at a record $3,820.90 per ounce, reflecting a 45% year-to-date increase. Silver futures climbed 0.97%, reaching $47.11 per ounce—their highest level in 14 years. Platinum also advanced, achieving a 12-year peak amid growing expectations for increased demand in the automotive sector for catalytic converters.

The bond market exhibited subtle shifts, with the yield on the 10-year U.S. Treasury inching down to 4.144%. Simultaneously, the U.S. dollar weakened, as investors anticipated that the economic slowdown triggered by a government shutdown could prompt the Federal Reserve to ease its monetary policy further.

Corporate Movers: Electronic Arts Soars, Furniture Stocks Tumble

In corporate news, shares of Electronic Arts (EA) surged 4.5% following reports of a potential acquisition by Saudi Arabia’s Public Investment Fund (PIF) and a consortium in a blockbuster leveraged buyout (LBO) worth $52.5 billion. If finalized, this deal would mark the largest LBO in private equity history. The speculation also boosted stock prices for other gaming industry players, including Roblox (RBLX) and Take-Two Interactive (TTWO).

Conversely, furniture companies saw sharp declines after President Trump announced plans for additional tariffs on imported furniture. Williams-Sonoma (WSM) dropped 4.65%, RH fell 2.3%, and Haverty Furniture Industries also recorded losses, underlining investor concerns over sector exposure to trade policy developments.

Solid Year-To-Date and Quarterly Performance Amid Uncertainty

Despite the political turmoil, major indices have delivered strong results for September and the third quarter. The S&P 500 has risen 2.8% month-to-date, while the Nasdaq posted gains of 2.9%. The Dow Jones Industrial Average saw a more modest advance of 1.5%.

Market experts observed that while a government shutdown could inject short-term volatility, historically, such events have had limited long-term economic impact. However, the absence of key economic reports may complicate the Federal Reserve’s decision-making process, potentially prompting more cautious positioning by investors in the weeks ahead.