Government shutdowns make big headlines. But what do they really mean for your investments?
History shows the impact is usually limited.
– In the 1995–96 shutdown, the S&P 500 rose about 1.3%
– In 2013, it gained roughly 3%
– Even during the record 35-day shutdown in 2018–19, markets recovered and ended higher
Why? Essential services keep running, shutdowns are temporary, and investors know politics eventually reach resolution.
The bigger risks come if a shutdown drags on during a weak economy, or if it’s tied to a debt ceiling standoff. That’s when volatility can spike.
Bottom line: Shutdowns are more noise than signal. Short-term swings may happen, but long-term investors shouldn’t let the headlines knock them off course.
