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Navigating the Government Shutdown: Impacts on Wall Street and Beyond

Market Movers: The Opening Bell

October 2, 2025

Video Transcript

Let's get to the big story breakdown.

It is day two of the US government shutdown.

This does come after lawmakers failed to reach a deal to keep the government open, with Democrats pushing to extend key health care tax credits and any new funding bill.

Well, historically, government shutdowns have had limited impact on Wall Street.

In fact, the S&P 500 has risen during every shutdown since 1990.

But zooming out over the past 50 years, the average dropped during a shutdown is about 1.6%, with the worst hit coming.

In 1979, meanwhile, pharma stocks pushed major indexes to new highs.

Wall Street keeps trekking higher with the S&P 500 closing above 6700 for the first time ever.

Joining me live here at the New York Stock Exchange is Matt Cheslock, trader at Virtue Financial.

Matt, good morning.

Thank you so much for joining me.

Good morning, Roy.

How are you?

Well, we are looking at the S&P 500 set to open higher year to date.

That index is up 14%.

But what do you make of what we're Seeing in the nation's capital and what does this mean for Wall Street? just more political decisiveness, you know I mean it's just, you know, I think the problem that we see as traders is that this just keeps going on and on and on.

So we've kind of getting a little bit immune to it unfortunately.

I mean this is kind of a serious event, but you know, 2 days, 3 days in, it's not quite there yet, you know I think traders are anticipating a 2 week shutdown.

If it goes more than that, you know, I think there's real cause for concern.

Yeah, and when we take a look back at the equity markets for 2025, the major indexes are seeing strong gains.

But as you mentioned, the longer the shutdown lasts, the more it will affect the economy and of course Wall Street.

So usually the first Friday of every month we get the jobs report, and this morning we're supposed to get that weekly jobless claims number.

But the further that this shutdown goes, the lack of data as well as the direction for the.

And what are you concerned about?

You know what, maybe we'll actually get a legitimate jobs number in November.

We'll get something that we took into account over a whole month, and we can actually use that number.

So that's what would be exciting about this whole event that we don't get these jobs numbers and we over analyze what we're going to get, you know, we saw a reaction yesterday to the private number that was surprisingly weak, but that's a benefit for all the Fed watchers out there looking for a rate cut, so.

Most of the data has been quite mixed.

The markets are trending higher.

October is historically a great month, so nothing really is changing on that front.

We're seeing some new leadership groups, you know, you talk about the S&P hitting new highs.

You're talking about Nasdaq hitting new highs.

You know, we're starting to get the IPO pipeline to loosen up here a little bit in this 4th quarter.

Let's see how big the shutdown affects the IPO market because eventually a government entity has to clear them, so.

There's a lot out there, but we're not affected by it right now, as I mentioned, you know, I think the end of next week, I think that's cause for more concern.

Yeah, and that of course we're keeping an eye on the latest announcements that are coming out from the nation's capital.

But here on Wall Street and especially behind your monitors, I know that you're keeping a close eye on charts.

And what do you make of what we're seeing in pharmaceuticals?

Wow, I mean, you know, another new leadership.

Group, you know, I mean, it's funny that you know we're talking about these these pharma companies now having to cut costs to help the American consumer.

It's a good thing, right?

Why couldn't we have done this a long time ago and you start to see, you know, some of the benefits and some of the reaction to the stocks and some of these farmers that have been lagging.

We're starting to see some pops in those.

You're starting to see, you know, the lilies, the ones that have led for so long, you know, they're still going higher.

This is a positive.

This is a positive for, I think America as a whole, as far as the users of these products, and you know these companies may see more of a benefit as well, at least in the short term, as far as traders are excited about this.

And I do want to get your take on tariffs, so we continue to hear about new tariffs and the potential for them to affect sectors as well as industries.

So how are you going about digesting this?

Well, the tariff news is kind of getting a little bit old, you know.

We saw Nike earlier this week, you know, shrug off some tariffs and rally considerably higher.

So that tariff news should have been already in play.

In a lot of people's minds, right, so you can't use that excuse going forward.

It's been, you know, one or two quarters.

Now we're approaching 4th quarter.

That should be baked in a little bit, but the threat of a new tariff, obviously, you know, we saw it in pharma and then it was delayed and we saw them move higher.

So it's a means to negotiate certainly I think right now the tariff news is also a little bit tired.

And finally, before I let you go, you mentioned the end of this year and of course we're counting down not just to Thanksgiving but also to Christmas as well.

It's hard to believe that we're heading into that time of year, but historically markets tend to do well, right?

So what do you expect to see and what are the catalysts that you're watching?

Amazingly, I haven't seen any commercials for any Christmas retail stuff yet, you know, I mean, we're approaching that pretty quickly.

You mentioned 2 months away, but you know that hasn't been the talk.

I think there's enough out there for us to digest right now, you know, there's the flight to quality or flight to safety, you know we're talking gold at all time highs, cryptos at all time highs, you know, so there's enough to worry about other than looking that far ahead.

People are trading almost day to day trading on the news.

I've never seen reactions like we've seen.

We've talked about this in the past, seeing 100%. moves often one single earnings report.

So that's going to continue.

So while it's volatility, most of it has been to the upside, so people aren't so concerned.

If that does change, you know, when we start to see some downward volatility, I think people will get a lot more concerned.

Yeah, and earnings season will be kicking up shortly as well.

So a lot to keep our eyes on as we head into the month of October.

Thank you so much for joining me, Matt.

Thank you.

“I think traders are anticipating a two-week shutdown.” – 01:14

Matt Cheslock, Trader at Virtu Financial, joins Remy Blaire at the New York Stock Exchange to discuss the implications of the ongoing U.S. government shutdown, which is now in its second day. The shutdown follows lawmakers’ failure to reach a funding agreement, with Democrats advocating for the extension of key health care tax credits. Remy highlights the historical context of government shutdowns, noting that while they have had limited impact on Wall Street—where the S&P 500 has risen during every shutdown since 1990—the average drop during a shutdown over the past 50 years is approximately 1.6%, with the most significant decline occurring in 1979.

The pair discuss the current state of the S&P 500, which is up 14% year-to-date and recently closed above 6,700 for the first time. Matt shares his insights on the political deadlock in Washington, expressing that traders are becoming somewhat desensitized to the shutdown. However, he warns that a prolonged closure could raise serious concerns for both the economy and Wall Street.

The conversation shifts to the upcoming jobs report and the potential impact of the shutdown on economic data. Matt suggests that a legitimate jobs number in November could provide a clearer picture of the labor market, as the lack of data during the shutdown complicates analysis. He notes that October is historically a strong month for markets, and despite mixed economic data, the markets are trending higher.

Remy and Matt also explore the pharmaceutical sector, which is currently experiencing a surge. Matt points out that pharmaceutical companies are cutting costs to benefit consumers, leading to positive reactions in their stock prices. They touch on the topic of tariffs, with Matt indicating that the news surrounding tariffs is becoming stale, as companies like Nike have already adjusted to the situation.

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