U.S. markets eased back on Thursday, pulling away from fresh intraday highs as the government shutdown stretched into its ninth day. The S&P 500 fell 0.28 per cent to close at 6,735.11, while the Nasdaq Composite slipped 0.08 per cent to 23,024.63. At session highs, both had managed modest gains before sliding into negative territory. The Dow Jones Industrial Average dropped 243 points, or 0.52 per cent, to finish at 46,358.42.
The moves followed a strong Wednesday, when both the S&P and Nasdaq notched records, with the Nasdaq crossing the 23,000 mark for the first time. Nvidia had been a key support in that session, advancing more than 2 per cent after CEO Jensen Huang noted surging demand for computing power.
Rotation in tech and AI stocks
Thursday saw a mixed picture among technology leaders. Oracle gained 3 per cent, while Nvidia rose nearly 2 per cent, both reclaiming ground after losses earlier in the week. A report had raised questions about Oracle’s cloud margins as it rents Nvidia chips, but investors appeared encouraged by renewed optimism around artificial intelligence demand.
Government shutdown weighs on sentiment
Investors also kept a close eye on Washington, where the Senate once again failed to advance competing funding bills. The stalemate has already forced the IRS to furlough nearly half its workforce, and a shortage of air traffic controllers has led to flight delays. Delta Air Lines CEO Ed Bastian said he has yet to see direct impacts but warned issues could arise if the shutdown drags on another 10 days. Delta stock jumped 4 per cent on stronger-than-expected earnings.
Resilient consumer lifts corporate results
Costco shares also climbed 3 per cent after reporting solid September sales. Analysts pointed to the strength at Delta and Costco as evidence of consumer resilience, even in an uncertain macro environment.
Meanwhile, investor sentiment surveys show optimism remains elevated. The American Association of Individual Investors found bullish expectations at 45.9 per cent, well above the long-term average.
Australian market outlook
The local market is set to open lower, with SPI 200 futures pointing to a 0.4 per cent fall.
Investors will be watching RBA Governor Michele Bullock’s Senate testimony on Friday, as well as fresh data on New Zealand manufacturing activity, for further signals on regional economic momentum.
