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Why investors don’t need to play defense during the government shutdown — even if it lasts

1. Government shutdowns historically average eight days; S&P 500 remains flat during them. 2. Past shutdowns show minimal impact on market; gains are slightly more probable. 3. During longest shutdown, S&P 500 rose, led by financial and discretionary sectors. 4. Investors tend to not become overly defensive during shutdowns, history supports this. 5. S&P 500 briefly dropped but gained ground in subsequent trading.

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FAQ

Why Bullish?

Historical trends show minimal negative impact on S&P 500 during shutdowns, with potential for gains. Previous shutdowns led to S&P 500 increases, indicating resilience in the index.

How important is it?

The article focuses on historical context regarding government shutdowns, providing insights into short-term market behavior affecting S&P 500. The likelihood of driving S&P 500 price discussions is moderate based on historical performance.

Why Short Term?

Market reactions typically stabilize shortly after government shutdown news. The immediate impact is more pronounced than long-term effects, as shutdowns are often brief.

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