BREAKING: Wall Street is experiencing mixed trading as fresh concerns over elevated technology valuations arise, coinciding with the ongoing discussions to end the longest government shutdown in U.S. history. As of early trading on October 31, 2023, the S&P 500 has dipped 12.76 points, or 0.19 percent, to 6,819.67, while the Nasdaq Composite has lost 105.88 points, or 0.45 percent, to 23,421.61.
Market sentiment is being dampened by a troubling update from ADP, which revealed that private employers shed an average of 11,250 jobs per week for the four weeks ending on October 25. Jamie Cox, managing partner for Harris Financial Group, commented,
“The ADP data misses a significant fraction of the overall labor market and does not provide much of a window into its health.”
His remarks underline the uncertainty surrounding the labor market, contributing to Wall Street’s cautious stance.
Earlier this week, technology and AI stocks briefly rebounded from steep losses, spurred by optimism that the government could reopen soon, alleviating pressure on the economy. The Nasdaq had recorded its largest daily gain since May 27, while the S&P 500 saw its biggest one-day percentage rise since mid-October in the previous session.
In early trading, the Dow Jones Industrial Average rose 72.81 points, or 0.16 percent, to 47,441.44, buoyed by gains from companies like McDonald’s and Goldman Sachs. However, shares of Nvidia plummeted 2.3 percent after the SoftBank Group disclosed it had sold its remaining shares in the AI leader for $5.83 billion.
Concerns continue to loom over AI-related firms that have led the bull market this year, as traders scrutinize returns from technology investments. In a significant move, Nvidia-backed CoreWeave saw its shares decrease by 10.8 percent after the cloud computing company reduced its annual revenue forecast.
On a more encouraging note, the U.S. Senate has approved a bipartisan bill aimed at ending the government shutdown, which has disrupted food benefits for millions and left federal workers unpaid. The bill is now headed to the House of Representatives for approval before reaching President Donald Trump, who has warned of an economic disaster if the Supreme Court rules against his use of emergency powers to impose tariffs.
Cox predicts,
“The shutdown will be substantively over by Thursday at the latest, and you will continue to see follow-through from Monday’s rally once the holiday has concluded.”
This optimism may provide a much-needed boost to the markets.
In corporate news, Paramount Skydance surged 8.7 percent after announcing significant cost cuts and plans to invest $1.5 billion in its streaming and studio divisions. Additionally, shares of Rocket Lab jumped 4.7 percent following a record third-quarter revenue report, while Occidental Petroleum gained 3.6 percent after exceeding third-quarter profit expectations.
As the market navigates these turbulent waters, advancing issues outnumbered decliners on both the NYSE and Nasdaq, with a ratio of 1.66-to-1 on the NYSE and 1.23-to-1 on the Nasdaq. The S&P 500 recorded 14 new 52-week highs and one new low, while the Nasdaq Composite noted 29 new highs and 52 new lows.
With the government shutdown and tech valuations in focus, investors remain on high alert as developments unfold. Stay tuned for real-time updates as this situation continues to evolve.
