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Chances of a government shutdown spike after Trump cancels meeting with Democrats. Here’s what comes next.

1. Government shutdown likelihood is rising due to budget impasse. 2. Partial shutdown could disrupt federal operations starting Oct. 1. 3. Prediction markets show a 73% chance of a shutdown. 4. Past government shutdowns saw S&P 500 rise four times. 5. Federal employee payroll and IPO processing may be interrupted.

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FAQ

Why Neutral?

Historically, the S&P 500 has performed well during shutdowns, suggesting limited negative impact.

How important is it?

While shutdowns affect sentiment, the S&P has rebounded historically, reducing long-term impact.

Why Short Term?

The shutdown could lead to immediate market reactions but typically stabilizes after resolution.

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