Closing Bell: Markets Shake Off Washington Shutdown, End Day Higher

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Markets React To Government Shutdown
Spencer Platt/Getty Images
Despite ongoing rancor in Washington, investors stayed calm Tuesday, sending stocks higher on the first trading day of the final quarter of 2013, as the U.S. government began a partial shutdown.

The Dow Jones industrial average (^DJI) added 62 points, or 0.4 percent, to 15,191, the Standard & Poor's 500 index (^GPSC) edged up 13 points, or 0.8 percent, to 1,695 and the Nasdaq composite index (^IXIC) gained 46 points, or 1.2 percent, to 3,818.

The long-running dispute in Washington over President Barack Obama's health care law led Republican lawmakers to hold the U.S. budget hostage, forcing about 800,000 federal workers off the job and suspending all but essential government services. With the Republican-controlled House of Representatives and Democratic-controlled Senate locked in a stalemate, it was unclear how long it would be before the House and Senate could agree to pass a temporary budget to finance government activities.

Despite the political rancor, investors didn't push the panic button. That suggests that, at least for now, they aren't anticipating that the stalemate will last long enough to cause a serious disruption in the economy and threaten the slow-but-steady U.S. recovery -- or the current four-year bull run in the stock market.

In the latest encouraging news on the economy, a private industry group reported that U.S. manufacturing expanded at the fastest pace since April 2011 last month on stronger production and hiring.

But with the closure of federal agencies, the release of a report on construction spending for August, which had been scheduled for 10 a.m, was delayed. If no deal is reached by Friday, the closely watched monthly jobs report will also be delayed.

In commodities news, benchmark oil for November delivery fell 48 cents to $101.85 a barrel, while gold slipped $36.20 or 2.7 percent, to $1,290.30

The tech-heavy Nasdaq was given a boost by Apple (AAPL), which rose $11.25, or 2.4 percent, to $488, after billionaire investor Carl Icahn told CNBC about his dinner meeting with Apple's CEO Tim Cook. Icahn, who said he has invested $2 billion in Apple, is pushing for Apple to spend $150 billion buying its own stock. "I feel very strongly that this should be done," Icahn told CNBC. "It's a no-brainer."

Amazon.com (AMZN) shares rose 2.5 percent to $320.56 after a Citigroup (C) analyst said in a research note Tuesday that the company's seasonal hiring plans indicate that the online retailer is expecting a strong holiday season. Amazon said it plans to hire 70,000 full-time seasonal workers in its 45 fulfillment centers in the U.S., a 40 percent increase from its holiday hiring last year.

More Stocks in the News:
  • Merck (MRK) led the Dow higher after saying it would cut 8,500 jobs and move its headquarters to save costs. Merck rose 2.4 percent to $48.75.
  • Ford Motor (F) moved up 1.8 percent to $17.18 after the company reported a 6 percent increase in its September sales. General Motors (GM) dipped 0.2 percent to $35.90 following its sales results.
  • Walgreen (WAG) rose 4.5 percent to $56.23 after the largest U.S. drugstore chain reported that its earnings soared 86 percent.
  • Smith & Wesson Holding (SWHC) said it plans to buy back up to $15 million of its stock and has eliminated its "poison pill" provision. CEO and President James Debney said in a statement that the company believes that investing in itself is presently one of its greatest opportunities. Shares of the Springfield, Mass.-based gunmaker rose 1.6 percent to $11.17 amid a broader market uptick.
  • Citing the shutdown of the U.S. government shutdown, the Justice Department requested a stay of proceedings in its legal fight with US Airways Group (LCC) and American Airlines parent AMR Corp. over the carriers' proposed merger. "Absent an appropriation, the Department of Justice attorneys and employees are generally prohibited from working, even on a voluntary basis," the agency said in a motion.
What to Watch Wednesday:
  • Monsanto (MON) reports third-quarter financial results before U.S. stock markets open.
  • Payroll-processor Automatic Data Processing (ADP) releases its survey of private-sector hiring for September at 8:15 a.m. Eastern time.
  • Federal Reserve Chairman Ben Bernanke speaks in St. Louis at 3 p.m.
-Compiled from staff and wire reports.


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31 Comments

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findrobin

lolllololololololololololololololololololololoololololololololo

October 02 2013 at 7:25 AM Report abuse rate up rate down Reply
toosmart4u

Now we should go to a one payer health insurance like the rest of the world. This would help our business\'s compete on the world market. Our companies pay for health insurance while the rest of the world does not.

October 02 2013 at 4:48 AM Report abuse rate up rate down Reply
2 replies to toosmart4u's comment
sam54ct

Hey, finally someone who gets it, our companies are not competing on a level playing field, when they are bidding against companies that do not have to pay out for healthcare insurance for employees, typically around 25% - 35% of the cost per employee.

October 02 2013 at 9:40 AM Report abuse -1 rate up rate down Reply
hugh_geenormous

If it's free, who is paying for it?

October 02 2013 at 10:46 AM Report abuse +1 rate up rate down Reply
alfredschrader

Looks less like a shake-off and more like a vote of approval.

October 02 2013 at 4:17 AM Report abuse rate up rate down Reply
hugh_geenormous

Invewtors likey the shut down

October 02 2013 at 12:51 AM Report abuse rate up rate down Reply
jbjap

It's probably responding well because DC will actually cut down on its spending for a change.

October 01 2013 at 11:00 PM Report abuse +1 rate up rate down Reply
betty_brock

We liberals think Obama should be king of the world.

October 01 2013 at 10:30 PM Report abuse rate up rate down Reply
1 reply to betty_brock's comment
sam54ct

We Conservatives think Reagan, who enacted the Tax Reform Act of 1983, that allowed him to become the first to drain the Social Security surplus to pay for his tax cuts should have been King. Or Bush Junior who along with a GOP controlled Congress & Senate through 2006 brought on a worldwide recession wiht poor policy, tax cuts, two wars, and in 2007 the lessening of requirements for Food stamps. Under Bush food Stamps went from 14 million to 36 million, than to 44 million under Obama, guess who broke the system?

October 02 2013 at 9:44 AM Report abuse rate up rate down Reply
1 reply to sam54ct's comment
hugh_geenormous

Reagan wasn't the first sam.....where do you get this stuff?

It's all bullshlt

October 02 2013 at 10:48 AM Report abuse +1 rate up rate down
betty_brock

Evan has been here with his magic thumbs down wand. You know you have the truth when he gives you multiple minuses.

October 01 2013 at 10:17 PM Report abuse rate up rate down Reply
pdbliz

Looks like 2 of us have got a lot of negative.!!!!!! I LOVE IT,,,,,!!!!!!!!
Been camping 3 days,,,,did not hear about this till today......Driving home,,I seen schools in,,,,fast food joints running smooth,,,planes in the air,,,birds flying,,.police out,,,hospitals running.....
But, no park service....................BIG DEAL.!!!!!!!! WHAT GOVERMENT AGENCYS WERE CLOSED,,,,WERE NOT LIFE THREATNING.....
ALL DEMOCRATE COVER UP..........RUN FORREST RUN,,,,THE SKY DID NOT FALL.!!!

October 01 2013 at 10:15 PM Report abuse +1 rate up rate down Reply
1 reply to pdbliz's comment
betty_brock

It is a badge of honor to be low rated by Evan.

October 01 2013 at 10:29 PM Report abuse rate up rate down Reply
a1putwins

Here's a hot tip . Over the next six weeks invest in every large company that sends their employees to the insurance exchange.
Call it the "Public Thud Index" With thousands of employees givena check and told to fend for themselves with healthcare think of the savings in HR costs and all te otherthings involved in providing insurance to loyal employees.
The bottom line has to show a nice bump if not a steady bankable trend.
That index will sell Jimmy..The" Public Thud Index", The thud is the sound that the pine box makes when it hits the bottom of the whole when ole dave in the mairoom passes on.
The" Public Thud" is making some noise as these big box companies are bailing out of insurance and wishing their employees all the best in finding the right plan. The bottom line will be siging for at leeast two quarters so invest up with these clever groups who have the good sense to do what they do and let insurance and Obama do what he do.
Those who are among the "Public Thud " group know who they are and they know that when the pine box its the bottom of the hole it will in fact nmake a thudding sound. We need to be real about this new way of covering employees.
If it thuds publicly buy it..
Home deport announced just today that they are on to the "Public Thud" and expect to save all kinds of money.mDevelop your own index and sell it to you clients...I will sell you the domain "Public Thud" for 500 dollars. Its a money maker.

October 01 2013 at 8:43 PM Report abuse +1 rate up rate down Reply
1 reply to a1putwins's comment
Hello Bob

This may prove to be a turning point in US healthcare by providing the impetus to go to a national single payer health system. Thereby, saving companies and individuals hundreds of billions of dollars each and every year. Go for it !

October 01 2013 at 10:13 PM Report abuse +2 rate up rate down Reply
betty_brock

If these workers are "non essential" let them stay home forever.

October 01 2013 at 8:34 PM Report abuse -7 rate up rate down Reply