Stocks are in the red as the government shutdown looms, with little hope for important jobs data. Despite this uncertainty, history suggests there may not be cause for concern in the stock market.
A trader from Lord Fed’s Gazette predicts a boost to the S&P 500 as skittish investors show hesitation in buying stocks. Recent data from Goldman brokerage reveals hedge funds are reducing their exposure, selling tech stocks at a rapid pace.
Wall Street’s big investors have been cautious since the April selloff, with retail investors driving the market. This unexpected behavior may indicate a potential continuation of the bull market, as managers are selling into strength at multiyear highs.
Recent selling by Wall Street’s smart money has provided dry powder for the market to potentially reach new highs. The path to 7,000 for the S&P 500 is now more likely due to the cautious approach of discretionary managers.
Stocks are dropping in response to the government shutdown, with Treasury yields lower and the dollar falling. Gold is on track for yet another record high as key assets show mixed performance over various timeframes.
Private-sector ADP payrolls fell by 32,000 in September, marking the third time in four months that businesses have cut jobs. Data on manufacturing PMI and auto sales are expected, while Lithium Americas stock surges after reaching a deal with GM and the DOE for a loan. Investors are wary of the stock market, which is seen as a positive sign. AES stock surges 15% after GIP launches a $38 billion bid. Berkshire Hathaway eyes a $10 billion deal for Occidental Petroleum. Nike shares rise on upbeat outlook. Fermi raises more than expected in IPO.

Government shutdown affects data releases and health insurance costs. White House withdraws nomination to lead Bureau of Labor Statistics. Vanguard shows mixed market reactions to shutdowns historically. Top-searched tickers include NVDA, TSLA, GME, NIO, and AAPL. Vermont butter sells for $60.

Self-driving taxi gets pulled over by cops. ‘Wheel of Fortune’ contestant becomes a millionaire. Young Japanese investors embrace stocks. Barron Trump’s fortune tops Melania’s due to crypto investments. Market reacts positively to shutdowns in history, with S&P 500 finishing in the green most of the time. Big investors on Wall Street are showing fear towards the stock market, but one trader believes this is actually a positive sign. MarketWatch reports that the fear among investors could potentially lead to better opportunities for savvy traders looking to capitalize on the uncertainty.

Read more at MarketWatch: Big investors are afraid of the stock market, and the S&P 500’s path to 7,000 just got easier.