No News Is Good News: Markets Rally Despite Shutdown Silence
Shutdown, But No Panic
Shutdown
The federal government’s shutdown entered its third day Friday, halting the release of critical economic data, including the monthly jobs report. Yet Wall Street showed no signs of anxiety.
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$S&P 500(.SPX)$ : +0.01% Friday, +1.1% weekly, new record
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Dow Jones: +0.5% Friday, +1.1% weekly, sixth straight gain
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$NASDAQ(.IXIC)$ : -0.3% Friday, but +1.3% weekly
The Cboe Volatility Index (VIX) remains in the mid-teens, a level consistent with calm, not crisis. Investors seem more focused on the next Fed rate cut, widely expected this month, and the kickoff of Q3 earnings season in mid-October.
The AI Debate: Bubble or Transformation?
A rare public appearance by Jeff Bezos added fuel to the ongoing AI conversation. He acknowledged AI may be in a “good kind of bubble”, where capital flows into both promising and weak ideas alike. But he stressed:
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AI is real, transformative, and will impact every industry. $NVIDIA(NVDA)$
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The challenge for investors: separating durable opportunities from overhyped experiments.
Markets reflected that tension Friday, with $Palantir Technologies Inc.(PLTR)$ , an AI software leader, slumping 7.5%, making it the S&P’s biggest loser.
Looking Ahead
The week ahead is light on data and earnings, but it’s the calm before the storm:
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FOMC Minutes (Wednesday) could clarify the Fed’s rate-cut outlook.
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University of Michigan Sentiment (Friday) will offer a private gauge of consumer confidence.
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Earnings trickle begins with Constellation Brands (Mon), McCormick (Tue), and Delta & $Pepsi(PEP)$ (Thu), ahead of big banks’ results the following week.
Conclusion
Markets are shrugging off Washington’s dysfunction and finding strength in the twin tailwinds of monetary easing expectations and robust corporate earnings. But as AI enthusiasm builds, Bezos’ warning rings true: separating sustainable innovation from speculative hype will be the real test for investors this quarter…
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