Wall Street: What Shutdown? Data Lift Stocks

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Wall Street traders shook off a partial government shutdown, and instead chose to focus on a round of upbeat economic data.

Today's Markets

The Dow Jones Industrial Average climbed 62 points, or 0.41%, to 15192, the S&P 500 gained 13.5 points, or 0.8%, to 1695 and the Nasdaq Composite climbed 46.5 points, or 1.2%, to 3818.

Wall Street has a propensity for getting over things fast. Such was the case Tuesday, when the markets pushed higher on the heels of a historic government shutdown. Indeed, the Nasdaq closed at its highest level since 2001 in the day.

Wall Street Yawns Over Shutdown, Frets About Debt Limit

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After a string of late-night legislation punting between the Senate and the House, the government officially went into shutdown mode at 12:00:01 a.m. ET. The Republican-controlled House would like to repeal or water down the Affordable Care Act. However, the Democratic-controlled Senate has little interest in changing President Barack Obama's hallmark legislation. 

The partial shutdown was the first since 1996, and will furlough up to one million workers and halt a slew of non-essential services. The mood across world trading desks was a frustrated calm. Analysts were broadly uncertain about when exactly the government would open its doors again -- but also confident that the economic impact would be fairly minimal.  

Peter Boockvar, chief market analyst at The Lindsey Group, pinned the muted reaction to two reasons: "1)The market believes the subsequent shutdown will be temporary and the eventual agreement will be wrapped up with a debt ceiling deal in the weeks to come and 2)the Fed won’t be tapering any time soon with the now GDP risk (however moderate) from the partial close of the government."

Still, Dan Greenhaus, chief global strategist at BTIG, told clients the market maker is becoming "increasingly nervous" about the prospects of breaching the debt ceiling on October 17.

"As is commonly accepted, the budget debate is small potatoes when compared to the seriousness that is the debt ceiling and the ramifications if that debate is not handled in a more orderly manner," he warned. 

Data Lift Spirits

Wall Street also got a stronger-than-expected report on the manufacturing sector and somewhat encouraging U.S. auto-sales data on the day.

Ford's (F) U.S. sales jumped 6% in September, compared to expectations they would remain unchanged Chrysler saw its sales rise 1% in September from the year, surprising analysts who were expecting sales to dip. 

The Institute for Supply Management’s gauge of manufacturing activity rose in September to 56.2 from 55.7 in August, surprising economists who expected the metric to fall to 55. It was the highest reading since April 2011.

The Commerce Department won't send out the construction spending report due to the government shutdown. 

Elsewhere in corporate news, Merck (MRK) said it plans on slashing 8,500 jobs by 2015 in the process of cutting $2.5 billion in expenses. 

In commodities, U.S. crude oil prices fell 29 cents, or 0.28%, to $102.04 a barrel. Wholesale New York Harbor gasoline slid 0.67% to $2.611 a gallon. Gold slumped $40.90, or 3.1%, to $1,286 a troy ounce. 

Foreign Markets

The Euro Stoxx 50 gained 0.49% to 2907, the English FTSE 100 dipped 0.41% to 6436 and the German DAX climbed 0.46% to 8634.

In Asia, the Japanese Nikkei 225 gained 0.2% to 14485. 

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