S&P 500 Bulls Should Stay Vigilant as Shutdown Looms

Group 1 - The article discusses the potential impact of a looming government shutdown on the stock market, particularly the S&P 500 Index (SPX), which is facing its first weekly loss of September despite a record close [2][10] - Historical data indicates that stocks generally perform poorly after the onset of a government shutdown, with the SPX showing an average return of -0.74% one week after a shutdown begins [6][8] - The last government shutdown in December 2018 was an exception, where the SPX gained over 9% in the month following the shutdown, contrasting with the overall trend of underperformance during shutdowns [6][7] Group 2 - The worst historical performance for the SPX occurred during the 1995 shutdown, which saw a drop of nearly 7.9%, suggesting that current levels near 6,640 could fall to around 6,115 if similar conditions arise [7] - The article provides a detailed table of past shutdowns, showing varying impacts on the SPX, with the average return one month after a shutdown being -0.78% [8][9] - The article highlights the volatility in the market as the deadline approaches, with the Cboe Volatility Index (VIX) serving as a potential indicator for investors [10]