The Profit Margin: October 6, 2025
Statistic of the Week
Taylor Swift launched her highly anticipated album, “The Life of a Showgirl.” The release influenced workplace dynamics, with up to 6% of employees indicating they intended to take PTO to celebrate the album. Among those surveyed, 36% identified as Swift fans. Ten percent of Swift enthusiasts reported having dedicated work group chats on platforms like Slack or Teams to discuss the artist.
Global Perspective
Ukraine has continued to inflict significant damage on Russia’s energy infrastructure, with the frequency of attacks increasing in recent weeks. Over the past two months, approximately 85 high-value targets within Russia’s military-industrial complex have been struck, primarily through the use of Ukrainian drones. Current estimates suggest that up to 40% of Russia’s energy infrastructure has been affected, with as much as 20% remaining offline at any given time.
Market Moving Events
Tuesday: Trade Deficit*, Consumer Credit
Wednesday: FOMC Meeting Minutes
Thursday: Jobless Claims*, Wholesale Inventories
Friday: Consumer Sentiment, U.S. Federal Budget*
*Denotes data unlikely to be released if federal government remains closed.
Commentary
Despite the start of the federal shutdown last week, investors appeared unphased. All three major U.S. equity indices reached record highs during the week’s trading.1 The Nasdaq led the gains, advancing 1.32%.2 The DJIA and the S&P 500 increased by 1.10% and 1.09%, respectively.3 Meanwhile, fixed income yields showed little reaction. The 10-year Treasury yield declined by 0.02% to close Friday at 4.12%.4
Many key economic indicators are not released when the federal government is closed. The Bureau of Labor Statistics, Bureau of Economic Analysis, and Census Bureau produce reports that are widely relied upon by economists and investors.5 Their closure will cause investors to focus more on private data like the ADP employment report. ADP is a payroll processing company. The ADP employment report for September showed stress in the labor markets. According to ADP the U.S. economy lost 32,000 jobs in September. August’s figure was revised from a gain of 50,000 jobs to a loss of 3,000 jobs.6 The next major report is the CPI, due on 10/15.
Historically, government shutdowns do not have a lasting impact on market performance. However, they do act as a drag on the economy, with analysts estimating that the economy loses 0.1% to 0.2% of GDP growth each week the government is closed.7 It is reasonable to ask, “For how long will investors shrug off the government shut down?”
Chart of the Week
As of now, the U.S. government remains shut down. The federal government follows an annual budget cycle that concludes on September 30th each year. In the absence of an approved budget or appropriations bill, the government will remain closed.
Source Materials
Market Moving Events:
MarketWatch.com
Chart of the Week: Clearnomics,
Congressional Budget Office
Statistic of the Week:
Morning Brew, Bamboo HR
Global Perspective:
The Economist
Commentary:
1. Investor’s Business Daily
2. Bloomberg
3. Bloomberg
4. MarketWatch.com
5. Barron’s
6. Investor’s Business Daily
7. Barron’s