The longest government shutdown in the history of the U.S. has now ended. That could send the stock market higher. Late Wednesday, President Donald Trump signed a bill to keep the government funded through the end of January. The measure was approved in the House by a 222-209 vote. The funding lapse led to delayed or suspended economic data, wreaked havoc at airports as flights were canceled due to air traffic controller shortages and fouled up the Supplemental Nutrition Assistance Program. Stocks, for their part, wobbled during the shutdown. The S & P 500 fell more than 2% in October and has gotten off to an uneven start for November. But going forward, stocks could see strong gains. “In the weeks ahead, markets will navigate a heavy release schedule as a backlog of key economic indicators is reported,” Canaccord Genuity technical analyst Michael Welch wrote. “While this influx of data should provide greater clarity on the shutdown’s economic impact, historical precedent indicates that following the end of prior shutdowns, the S & P 500 (SPX) has posted an average gain of 3.3% three months later and 7.8% six months later.” Welch also noted that the S & P 500 averages an 11.5% gain one a year after a U.S. government shutdown. Following the 2018 closure, which lasted 35 days, the index rallied 24% in the following year. Seasonality may provide another catalyst to hoist the market. Wall Street this month entered its best historical six-month period. Between Nov. 1 and April 30, the Dow Jones Industrial Average averages a 7.2% gain, according to the Stock Trader’s Almanac.
The government shutdown has ended. A look at how stocks perform after it reopens
