US equity markets experienced a significant downturn Thursday, casting a shadow over investor sentiment despite the formal conclusion of the longest government shutdown in US history. The Dow Jones Industrial Average closed at 47,457 points, a decline of 1.7% from the previous day’s close. The Nasdaq 100 fell to 24,993 points, marking a 2.1% decrease, while the broader S&P 500 finished the day at 6,737 points, down 1.7%.
The muted reaction following the shutdown’s end highlights underlying anxieties regarding the temporary nature of the agreement – a stopgap budget extending only until January 2026. This short timeframe leaves significant political and economic uncertainties unresolved, preventing a widespread market rally. Furthermore, the sustained period of low interest rates that fueled substantial growth appears to be facing increased scrutiny, with investors reassessing the valuations of major technology companies.
“Nervousness persists due to the elevated valuations within US equities” noted market analyst Andreas Lipkow, emphasizing that investor reactions are now highly sensitive to even minor pronouncements and data releases. This suggests a potential shift in investor confidence, or at least, a more discerning approach to risk.
The euro strengthened against the dollar, trading at $1.1631, reflecting a relative softening of the US economic outlook compared to the Eurozone. Gold experienced a slight depreciation, falling to $4,167 per ounce. In contrast, the price of Brent crude oil rose slightly, reaching $62.89 per barrel, albeit not enough to significantly alter broader market trends. The modest increase in oil prices may signal a rebalancing of energy sector expectations, but is unlikely to offset concerns surrounding wider economic fragility.