Stocks Sink as Shutdown Drags Into Record Territory

U.S. equities stumbled sharply at the start of November, marking the weakest monthly opening since April as the federal government shutdown entered its longest stretch on record. With key economic data frozen and policymakers operating without visibility, investor sentiment has deteriorated across nearly all major sectors.

The S&P 500 slipped further into negative territory, the Nasdaq declined as tech stocks faced renewed pressure, and the Dow weakened as shutdown-driven uncertainty weighed on risk appetite. Volatility spiked as traders struggled to handicap the economic outlook without jobs, inflation, retail sales, and housing data — all delayed indefinitely.

The shutdown has also complicated the Federal Reserve’s policy path. Without official economic readings, markets are increasingly concerned that the central bank may struggle to judge whether conditions warrant near-term easing or whether caution is needed to avoid stoking inflation. As a result, rate-sensitive sectors saw heightened swings, while defensives drew more interest.

Beyond Washington gridlock, global risk sentiment also softened. Concerns around slowing consumer demand, pressure on corporate margins, and softer labour-market indicators from private sources added to the cautious tone.

For traders, the coming days will likely remain volatile. The longer the shutdown persists, the greater the uncertainty around data-dependent policy decisions — leaving equities vulnerable to sharper pullbacks and sudden relief rallies tied to any progress in funding negotiations.