New York Report: Wall St awaits US government funding news
WITH a possible US government shutdown days away, Wall Street still has not come down with a critical case of fiscal fever despite forecasts that failure to resolve the federal budget standoff could be catastrophic.
The benchmark S&P 500 is up more than three per cent for September, which has traditionally been described as the worst month for stocks and was just two per cent off its all-time high.
Time was running short for lawmakers to avert a partial shutdown of the government starting tomorrow when the new fiscal year begins. An extended government shutdown, or even worse, a debt default, could harm the market’s reputation by rekindling memories of 2011 when similar political infighting prompted the loss of the United States’ triple-A credit rating and was the primary driver of the market’s last full-on correction.
If a government shutdown is avoided, Wall Street will focus this week on the critical September jobs report, expected on Friday. After the Federal Reserve decided to keep its stimulus efforts intact, investors will scrutinise the report for a better sense of when the central bank may begin to reduce the size of its bond-buying stimulus programme.
Other data this week include Chicago PMI and the Dallas Fed Manufacturing Survey, due today. The Institute for Supply Management manufacturing and construction spending reports tomorrow, followed by the ADP private-sector employment report on Wednesday. Weekly jobless benefits claims data are due on Thursday.