The US economy would suffer irretrievably in the event of a prolonged government dysfunction. That much was made clear by one of the White House advisers, who warned of a potential contraction in the fourth quarter unless government buildings reopen promptly.
A smorgasbord of factors incentivised stock market participants to bank some profits after a more-than-decent run in recent weeks and months. These include a slowdown in manufacturing activity worldwide, signalling stuttering economic growth. The longest government shutdown in US history did little to maintain investor confidence, and private data gained relevance.
The stage is set for a fall of a few dollars in oil prices. Why? Because of deteriorating economic conditions, as illustrated by the recent weakness in equities. The Nasdaq Composite Index lost 1.90% yesterday, while its cousin, the S&P 500 Index, finished the day 1.12% lower.
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