Traders on the floor of the NYSE, Aug. 23, 2023.
Stocks were mostly flat Monday even after U.S. legislators were able to come to a short-term agreement that staved off a government shutdown.
Shares of electric vehicle maker Tesla fell 1.5% after reporting a drop in total production and delivery volumes for the third quarter. Cryptocurrency-related stocks Coinbase and Marathon Digital advanced 5.5% and 12.7%, respectively, as crypto prices rallied.
The communications services and technology sectors were the only positive industries in the broad market index. Communication services added 1%, while tech sector traded 0.8% higher.
The Senate passed a continuing resolution with just hours to spare before a midnight deadline Saturday, which was then signed by President Joe Biden into law. The bill keeps the government open through mid-November, an extended period that lawmakers can use to finalize funding legislation.
The initial reaction to the shutdown deal was positive with equity futures in the green for most of Sunday evening into Monday. But futures fell into the red before markets officially opened as investors turned their focus back to surging interest rates near 15-year highs.
“Investors don’t like to be run to the edge of the cliff constantly,” said Jamie Cox, managing partner at Harris Financial.
Sentiment was dampened as investors feared lawmakers were headed for another shutdown fight eventually as Saturday’s agreement did nothing about brewing disagreements on overall government spending levels, the border and Ukraine.
“Markets are going to start to discount this being a 2024 event, as opposed to a 2023,” Cox said. “They’re just going to continue to kick the can down the road and push this into an election year.”