Let's get to the big story breakdown.
US stocks climbed as AI Buzz pushed tech to new records.
The S&P 500 closed above 6700 for the first time ever this week, with games driven by a surge in chip stocks.
Nvidia hitting yet another record high as well.
Meanwhile, OpenAI's valuation jumping to $500 billion on the heels of an employee share sale, overtaking SpaceX as the world's most.
Valuable startup.
Joining me on this non-jobs day to Friday is Peter Tuchman, senior floor trader at Trade jobs Friday.
So here we are, day 3 of the government shutdown.
We're looking at the major stock averages at record highs.
What is actually moving markets, Peter?
You know what?
I got to take my glasses off to figure this one out.
So normally historically when look.
Almost every year we come to this point where they threaten a job a government shutdown, right?
And usually in the witching hour, you know, they usually make a deal.
How does this differ?
How does this one differ?
Well, the bottom line is, I guess the Republicans, it's not a political statement at all, but the Republicans apparently, they claim that the Dems are the ones who are blocking it and then they stepped out of the negotiation and left even before midnight.
So it was almost as if they were not interested in making a deal the way things were set up.
Normally the market responds to this government shutdown.
That in a negative way, we've had in the past it'd be down from 100 to 1000 points based on how important people feel this is.
Obviously for some reason the market's not engaging in this in a negative way at all.
In fact, we're continuing to surge higher, probably for a couple of reasons.
We closed out the 3rd quarter beautifully.
There was no seasonality.
We closed record highs, massive influx of money, even.
On the last day of the quarter we had a $4.5 billion buy program.
It came in at 35959.
That is a crazy vote of confidence for the market.
Normally in a quarter that has as strong as we've seen on Q3, you have profit taking.
We didn't see that.
I mean there may have been, but we didn't see that from my interpretation of the flow.
We're still seeing people buy it.
Secondly, we had the first couple of days of Q4 and once again we're seeing, you know, normally in the beginning of quarters and the beginning of months you see a surge of money as people allocate money into their funds at the beginning of the month, and we saw that as well. $4 billion came in yesterday on the, so it's having no impact.
However, the longer it stays closed, the more impact there's going to be, and I agree with Mr.
Besant that is a fact that if this actually stays shut for 3 weeks, it will impact the GDP as much as I believe 1% is the number.
Maybe I'm I'm overblowing that number, but it will impact.
The the domestic growth national product, it's it's that significant long term, hundreds of thousands of government workers out of work for a long time, not getting paid and that whole thing being frozen eventually will impact the market.
Yeah, and we've heard this before and you said it to Peter that the market is not the economy.
The economy is not the market, and there are concerns that we will not be getting official data releases, especially as we head into the end of this month, because we have the Fed meeting at the end of this month.
But so far rate cut expectations for October as well as December have been rising.
So what does this all mean? when it comes to Americans out there, OK, so when you start a, OK, obviously we have not cut interest rates at all this year.
Last year we went through the same thing.
We waited until September.
There was probably a number of times that missed opportunities we found in July and August.
We talked about it the last time you and I chatted, and I think one of the contributing factors was that huge pullback we saw on August 6th of last year.
This year we also waited.
We waited until the economic data set the stage for the cut.
Mr.
Powell did not, in my opinion, kowtow to the president.
He waited until the weakness in the economy set the stage for him to decide that the data warranted a cut, which he gave us a 25 basis point cut.
We are when the economy is in an interest rate cutting cycle which we are just embarked on.
Historically, if that lasts for a year, for 12 months in the past, when that has been the case, the market at the end of that year has been up as much as 16%.
So that's a little bit of a light at the end of the tunnel for people wondering like, will this interest rate cuts end in a good positive bullish market or a bearish.
Historically this points towards a bullish market.
However, we don't know them.
These are a lot of these are powerful, you know, as much as tariffs are have impact on the.
Consumer and the corporations and the market and the economy, so does the government shutdown and you know, I don't know how the last time was I guess 7 years ago that it actually shut down.
I don't know the facts around how long it was and how where how the impact played out, but it can't be good.
Think about it.
There are people who are not getting paid today, you know, I saw it just to give people a little bit of a of a perspective, you know, tourists who are traveling around the country who went to What do you call it, like Grand Canyon National Park.
There was nobody there to open the park, right, or any number of things.
So if you're wondering like, oh, does it really impact my life, well, it does, it will, and it's going to based on, you know, you may show up at a government office and nobody's there, or you may want to go and renew your driver's license and know what he's I mean these are the things that we don't think they play a big role in our lives, but they do hundreds of thousands of people.
Now we do know that Mr.
Trump is promising.
That he could actually lay these people off that while we're shut down, it's not a furlough, which is how it normally is.
He may be using this opportunity to fire people.
Now I don't get that part of it.
The firing may be a way for him to save money.
I don't know.
I can't put myself in his head.
I'd rather do that.
But you know, I think we're at the crossroads of a lot of stuff and I think we just have to kind of watch it unfold.
Well, Peter, you and I will be back here bright and early on Monday morning, so we'll see how the markets close out the week.
Thank you so much for joining us.
