S&P 500 Posts Record High After U.S. Reopens
The S&P 500 gained 0.67% to close at 1,733.15, also eclipsing the benchmark's record intra-day high of 1,729. T he Dow Jones Industrial Average slipped 0.01% to 15,371.65. The Nasdaq rose 0.62% to 3,863.15.
President Obama signed legislation just past midnight that raises the debt ceiling through February 7 and secures funding to keep the government open until January 15. Anything past that date will require an agreement between the two parties.
"The market shrugged off the debt ceiling and it got it right," said Sandy Villere, co-portfolio manager of the Villere & Co Balanced and Equity funds. Investors, he said, would do well to remain invested in equities for as long as interest rates remain low. "They've been stints of weakness but we're playing the offensive rather than the defensive."
On the flipside, the second-largest gold miner Newmont Mining
While a much-feared fiscal crisis was averted, the resolution to the nearly three-week long shutdown failed to establish how the two major parties plan to deal with the national debt, leaving investors and tax payers to wonder whether to expect more 11th hour negotiations coupled with a government shutdown again early next year.
Obama said the extension meant government now had the opportunity to focus on a "sensible budget" with a negotiating committee charged with finding a sustainable solution to fiscal issues. Traders say the deadline extension means politics will continue to dictate market sentiment until early next year.
"I am happy that it's over," said Congressman Marc Veasey, a Texas Democrat in a phone interview. "A lot of the (Republican members of Congress) didn't want to go along with it, but the Tea Party took control of their primaries, and they felt they had to go along with the madness."