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The US shutdown is the latest headache for the stock market
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Loading...The 27th day of the US government shutdown — already a record-long closure — has added a new worry for investors after one of the most brutal year for equities in a decade.
It's a relatively new market catalyst and adds to a swathe of other headaches: There's Fed policy, the US-China trade war, the "leveraged loan" boom, eurozone drama, emerging-market turmoil, volatile oil prices, and even a possibility of a Trump impeachment.
"We're in unprecedented territory now, because we've never had a shutdown this long," said Ross Yarrow, a director of US equities at broker Robert W. Baird. "It's difficult to know if this is big in the market, because we don't know how the sheer amount of federal worker pay checks affect cash flow."
He continued: "We need to know how much of GDP will be deferred versus how much GDP will be destroyed. There could be a negative multiplier when you suddenly have 800,000 people with reduced purchasing power."
Source: BI
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