U.S. stock futures were fluctuating on Thursday following Wednesday’s record advances. Futures of major benchmark indices were mixed.

The Donald Trump administration has reportedly warned that the shutdown could cut $15 billion from weekly GDP and leave 43,000 more people jobless if it lasts a month.

After the Senate rejected competing government funding bills from both Republicans and Democrats on Wednesday, the next opportunity to hold a vote will be on Friday. The chamber will be out on Thursday in observance of Yom Kippur.

Meanwhile, the 10-year Treasury bond yielded 4.10% and the two-year bond was at 3.54%. The CME Group's FedWatch tool‘s projections show markets pricing a 94.6% likelihood of the Federal Reserve cutting the current interest rates in its October meeting.

The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, rose in premarket on Thursday. The SPY was up 0.18% at $669.68, while the QQQ advanced 0.39% to $605.58, according to Benzinga Pro data.

Cues From Last Session

Gains in sectors like Health Care and Utilities on Wednesday contrasted with losses in Materials and Financials, as major indices recovered from a sluggish start to end in positive territory. The move higher followed Tuesday, when stocks capped their strongest third quarter since 2020.

The S&P 500 notched its first record close above 6,700, and the Dow Jones Industrial Average gained to post its second consecutive record close.

For the time being, Wall Street appears to be overlooking the anticipated economic consequences of the government shutdown. The potential for a significant impact on growth increases with the duration of the shutdown, particularly for businesses that depend on the federal government’s regular operations.

From an economic perspective, the shutdown coincides with a precarious moment, as highlighted by Wednesday’s closely watched ADP monthly employment report. The data showed private payrolls unexpectedly fell last month, with the private sector shedding 32,000 jobs, missing forecasts that called for a gain of over 50,000.

The Dow Jones index ended 43 points or 0.093% higher at 46,441.10, whereas the S&P 500 index rose 0.34% to 6,711.20. Nasdaq Composite advanced 0.42% to 22,755.16, and the small-cap gauge, Russell 2000, gained 0.24% to end at 2,442.35.

Insights From Analysts

The Head of Global Fixed Income Strategy at Wells Fargo, Brian Rehling, advises investors to look past the current political impasse in Washington, suggesting a potential government shutdown will likely have a negligible long-term impact on the economy and markets. While a shutdown could cause modest, short-term pressure and volatility, historical precedent shows such events do not typically cause systemic disruptions.

According to Rehling, the biggest market impact from a shutdown would be the delay of key economic reports. This is particularly problematic as the Federal Reserve (Fed) maintains a “data-dependent” approach to monetary policy and is looking for data to support additional rate cuts.

A prolonged shutdown could affect the release of crucial data, including:

• The September jobs report
• Weekly jobless claims
• Consumer Price Index (CPI)
• Retail sales figures
• Producer Price Index (PPI)

Without this government data, the Fed may need to rely more on private data sources, such as ISM, ADP jobs, and Challenger layoff reports, to get a clear picture of the economy. Rehling believes a delay would not necessarily prevent a rate cut at the Oct. 29 FOMC meeting, but it does cloud the outlook.

Rehling anticipates any move in markets to brief and suggests that it could offer an opportunity for investors to reposition their portfolios.

• For bond investors: Lower yields could present a chance for investors to reduce exposure to long-term bonds, a segment where his team holds an unfavorable view. Rehling currently favors prioritizing the intermediate portion of the yield curve, with maturities between three and seven years.

• For equity investors: Any market pullback can be used as an opportunity to add exposure to favored cyclical and growth sectors incrementally. Wells Fargo currently rates Financials, Information Technology (IT), and Industrials as favorable. The firm also has a favorable rating on the Utilities sector, viewing it as a way to gain exposure to the secular buildout of data centers tied to artificial intelligence.

Rehling also highlights that essential payments will continue during any shutdown; the government will continue to pay its debts, Social Security, and Medicare.

The debt ceiling, having been lifted in July, is not affected by the current negotiations. He advises investors to focus on what he views as a constructive long-term economic outlook rather than the temporary “shutdown fog”.

Meanwhile, Louis Navellier from Navellier & Associates said that since the private sector is perceived to be better than the government sector, “believe it or not, productivity may actually rise during the federal government shutdown.”

He also added that historically, a federal government shutdown does not hinder the stock market and highlighted Bespoke Investment Group’s data on what happened during the last six federal government shutdowns.

“Specifically, the S&P 500 after a week, month, three months, six months, and one year later was up a median of 0.6%, 2%, 6.6%, 12.1% and 19.7%, respectively.”

See Also: How to Trade Futures

Upcoming Economic Data

Here's what investors will be keeping an eye on Thursday;

• Initial jobless claims data for the week ending Sept. 27, which was supposed to be out by 8:30 a.m. ET, will not be released because of the government shutdown.

• August’s factory orders data, which was supposed to be released at 10:00 a.m., will also be suspended; however, Dallas Fed President Lorie Logan will speak at 10:30 a.m. ET.

Stocks In Focus

• AngioDynamics, Inc. (NASDAQ:ANGO) jumped 6.14% in premarket on Wednesday ahead of its earnings report scheduled to be released before the opening bell. Analysts estimate earnings loss of 12 cents per share on revenue of $72.72 million.
• Entero Therapeutics Inc. (NASDAQ:ENTO) dropped 6.76% following its 100% acquisition of GRID AI Corp.
• Gulf Island Fabrication Inc. (NASDAQ:GIFI) climbed up 9.25% after announcing that it has been awarded a $35 million fabrication contract to support the rebuilding of the Francis Scott Key Bridge in Baltimore, Maryland.
• Globant SA (NYSE:GLOB) was up 1.32% as it disclosed that its board approved up to $125 million share repurchase program.
• Concorde International Group Ltd. (NASDAQ:CIGL) popped 55.25% as the company revealed that its Board of Directors and Compensation Committee had approved a 2025 Equity Incentive Plan.
• Fermi (NASDAQ:FRMI) gained 13.13% in premarket on Thursday following its Nasdaq debut and opening bell ceremony on Wednesday.
• AbCellera Biologics Inc. (NASDAQ:ABCL) was up 7.55% ahead of its third-quarter financial results scheduled on Nov. 6. Analysts are projecting an earnings loss of $0.17 per share and revenue of $6.45 million for the quarter.
• Grindr Inc. (NYSE:GRND) remained unchanged in premarket trading as it announced the appointment of John North as its chief financial officer, effective immediately.

Commodities, Gold, And Global Equity Markets

Crude oil futures were trading higher in the early New York session by 0.11% to hover around $61.85 per barrel.

Gold Spot US Dollar rose 0.31% to hover around $3,878.48 per ounce. Its last record high stood at $3,895.33 per ounce. The U.S. Dollar Index spot was 0.10% lower at the 97.6130 level.

Asian markets closed higher on Thursday, as Japan's Nikkei 225, Australia's ASX 200, South Korea's Kospi, Hong Kong's Hang Seng, China’s CSI 300, and India’s S&P BSE Sensex indices rose. European markets were also higher in early trade.

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