TLDR
- Stock futures for the Dow, S&P 500, and Nasdaq 100 all fell approximately 0.2% in premarket trading on Tuesday
- Congress faces a midnight Wednesday deadline to pass a funding measure or trigger the first government shutdown since 2019
- A shutdown would halt Bureau of Labor Statistics operations, potentially delaying Friday’s jobs report and other economic data
- President Trump announced new tariffs on lumber and wood furniture imports on Monday at rates lower than previously threatened
- The Federal Reserve may lack current economic data for its October 28-29 meeting if the shutdown extends beyond a few days
Stock futures fell across major indexes on Tuesday as investors faced two sources of uncertainty. Markets opened lower with concern mounting over political developments in Washington.
President Trump announced new tariffs on Monday evening. The tariffs include a 10% rate on lumber and timber imports. Certain wood-based furniture faces initial levies of 25%.
The rates came in lower than Trump had threatened last week. The move follows previous tariff threats on foreign-made movies and 100% duties on branded pharmaceutical imports.
Congressional Deadline Looms
Congressional leaders have until 12:01 a.m. Eastern time Wednesday to pass a short-term funding measure. Without an agreement, the government will shut down for the first time since 2019.
Trump and Republicans met with Democrats in the Oval Office on Monday. The meeting failed to produce a deal to prevent the funding halt. Vice President JD Vance told reporters after the meeting that he believes a shutdown is coming.
Dow Jones Industrial Average futures dropped 80 points or 0.2% in premarket trading. S&P 500 futures slid 0.2%. Contracts tied to the Nasdaq 100 also fell 0.2%.
Gold futures climbed 0.7% to $3,883 an ounce in early trading. The precious metal reached as high as $3,899 an ounce before pulling back. The dollar declined 0.2% against a basket of currencies.
The benchmark 10-year U.S. Treasury yield dropped 1 basis point to 4.13%. Bitcoin prices moved higher during the premarket session.
Data Release Concerns
The Bureau of Labor Statistics will “completely cease operations” during a government shutdown according to the Department of Labor. This would delay the release of Friday’s nonfarm payrolls report.
Deutsche Bank analyst Jim Reid noted the potential complications. The missing jobs data could affect market expectations for Federal Reserve interest rate decisions.
The September jobs report plays a key role in Fed policy thinking. The labor market’s health has become a focus after mixed economic readings. Some Fed officials have expressed different views on future rate cuts.
Tuesday’s JOLTS report on job openings may be the last labor market data from BLS for some time. Consumer confidence data is also scheduled for release Tuesday.
The Federal Reserve’s next meeting is set for October 28-29. A prolonged shutdown could leave policymakers without current economic data. The median government shutdown lasts two to three days according to historical data.
Trump also unveiled a 20-point plan aimed at ending the war in Gaza on Monday. The president said Israel would have his full backing if Hamas rejects the plan or it falls apart.
Stay Ahead of the Market with Benzinga Pro!
Want to trade like a pro? Benzinga Pro gives you the edge you need in today's fast-paced markets. Get real-time news, exclusive insights, and powerful tools trusted by professional traders:
- Breaking market-moving stories before they hit mainstream media
- Live audio squawk for hands-free market updates
- Advanced stock scanner to spot promising trades
- Expert trade ideas and on-demand support
