It is has been seven days since the government shutdown began and it still doesn’t seem that the two parties will resolve the impasse anytime soon. For the first 5 days, stocks had held up pretty well considering the current situation. However, with the October 17th deadline quickly approaching, stocks are beginning to drop.
Several bank stocks, like that of JP Morgan Chase, Citigroup, Golden Sachs, and Bank of America have dropped nearly two percent. Considering that the technological company of Macintosh/Apple has dropped thirty percent from their all time high numbers in 2012, Apple shares have actually been moving ahead recently with the release of the new IPhone.
Various professional analysts say the decreasing stock options will force the government to fix their issues much quicker. On the other hand, Bank of America made a statement that they feel “A resilient stock market and a cloudy economic picture may increase the risk of an extended shutdown”. Over the weekend, this bank had lowered their anticipated fourth quarter GDP growth from 2.5 percent to two percent.
Analysts are afraid that stock prices will be hurt by weak third quarter earnings. Capital market strategist Ishaq Siddiqi said the debt catastrophe could lead to a “subsequent meltdown of global asset prices.” Shares for company of Blackberry have raised nearly four percent as buyers are considering buying the devices in parts. It is apparent that the government shutdown is affecting many aspects of the U.S. and must be resolved soon. I know this situation has happened before and we have come back from it, but it is still a nerve-wracking circumstance.