U.S. stocks fall after government shutdown ends; Cisco impresses
Investing.com -- U.S. stocks slipped lower Thursday, with a rotation out of pricey technology stocks continuing even with the ending of the longest ever U.S. government shutdown.
At 09:35 ET (14:35 GMT), the Dow Jones Industrial Average slipped 73 points, or 0.2%, falling back from the previous session’s record close, S&P 500 index dropped 30 points, or 0.4%, while the tech-heavy NASDAQ Composite underperformed, falling 170 points, or 0.7%.
U.S. President Donald Trump signed a bill to unlock funding and end the longest government shutdown in U.S. history late on Wednesday, after the spending package was approved by the Republican-controlled House of Representatives.
The legislation, which will keep the government funded through January 30, was passed in a 222 to 209 House vote, mostly along party lines. The Senate signed off on it earlier this week.
The end of the shutdown brings an end to a 43-day period that has sparked widespread disruptions in federal services, most notable in air traffic and travel safety staffing, which in turn saw thousands of flights being cancelled across the country, potentially weighing on economic growth in the world’s largest economy.
It is also likely to lead to the resumption of crucial data releases used by investors and policymakers to gauge the actual impact on the health of the U.S. economy.
"With a bit of luck, we may see job numbers starting early next week," analysts at ING said in a note.
However, Trump administration officials have warned that employment and inflation for October might never be published because of the shutdown. If so, this could leave Federal Reserve officials in particular without key pieces of data before their next interest rate decision in December.
The tech sector has been under pressure of late, but it received some positive news with Cisco Systems (NASDAQ:CSCO) raising its annual guidance, prompted a jump higher in its stock price.
In a wager on a surge in demand for the equipment needed to underpin massive data center expansion sparked by the AI boom, the U.S. networking gear provider said it expects fiscal 2026 revenue to be between $60.2 billion and $61 billion, versus prior projections of $59 billion to $60 billion.
Full-year adjusted per-share earnings are tipped to be $4.08 to $4.14, compared to $4 to $4.06 previously.
Cisco, whose fiscal first quarter results also topped Wall Street expectations, predicted that it would rake in $3 billion in AI infrastructure revenue during its current year.
Elsewhere, Walt Disney (NYSE:DIS) stock dropped after the entertainment giant reported a drop in revenue in its fiscal fourth-quarter profit, with a tepid reception to the group’s latest slate of studio releases weigheding on returns at its key entertainment unit.
Flutter Entertainment (LON:FLTRF) stock fell as the world’s largest sports betting and gambling company cut its full-year guidance, citing winning streaks from gamblers.
Starbucks (NASDAQ:SBUX) stock slipped back after the union representing workers at the coffee giant launched a strike in at least 40 cities Thursday on Red Cup Day, one of the chain’s biggest sales days of the year.
Oil prices rose Thursday, bouncing after the previous session’s hefty losses after rising U.S. crude inventories reinforced demand concerns in the world’s largest consumer.
Brent futures gained 0.9% to $63.28 a barrel, and U.S. West Texas Intermediate crude futures rose 0.9% to $59.01 a barrel.
Both contracts dropped around 4% on Wednesday after the American Petroleum Institute said U.S. crude stockpiles rose by 1.3 million barrels in the week that ended November 7.
Also weighing was the news that the Organization of the Petroleum Exporting Countries said global oil supplies will slightly exceed demand in 2026.
Ambar Warrick contributed to this article
