President Trump keeps arguing the stock market is rising and falling on impeachment developments. There’s little evidence for such claims. 

But Trump just issued an impeachment-related threat that could cause investors to take notice: He is refusing to rule out shutting down the government if congressional Democrats expand their inquiry into whether the president traded access and aid for personal political gain. “I wouldn’t commit to anything,” Trump told reporters. “It depends on what the negotiations are.”

Federal government funding is set to expire Nov. 21 if lawmakers can’t agree at least to a stopgap measure. Negotiators have only eight legislative days left before that deadline. Talks don't look promising, with the explosive issue of border wall funding again dividing the parties. And Senate Minority Leader Chuck Schumer (D-N.Y.) said he is "increasingly worried” Trump will seek a shutdown as a distraction from his impeachment woes.

That would leave tens of thousands of federal workers without paychecks in the thick of holiday shopping season, making it a potentially more damaging economic disruption than the shutdown that ended earlier this year. That event started at the end of last year and stretched for 35 days, the longest on record. It shaved .1 percent from economic growth in the fourth quarter of last year and another .2 percent in the first quarter of this year, costing the economy a total of $11 billion, according to the Congressional Budget Office. 

The specter of a repeat has analysts who translate Washington news for Wall Streeters tracking the latest on the spending talks. "The impeachment inquiry into [Trump] has gained more traction and headlines, but its impact on the financial markets appears to be reaching the point of diminishing returns – at least until an endgame is within sight,” Oxford Economics Senior Economist Bob Schwartz writes. 

Indeed, Trump’s arguments that the stock market is gyrating over impeachment news don’t hold water. He chalked up a Friday rally to investors reading the transcript of his call with Ukrainian President Volodymyr Zelensky, though, as CNN’s Daniel Dale noted, it was released weeks ago: 

Similarly, Trump has predicted a market crash if Democrats see their inquiry through: 

Here is how the Dow Jones industrial average has performed since House Speaker Nancy Pelosi (D-Calif.) announced the launch of a formal impeachment inquiry on Sept. 24: 

Nothing suggests a correlation between the market and developments in the impeachment inquiry over this period. If there were a link, stocks should have tanked a month ago, when Trump stood on the South Lawn and invited Ukraine and China to investigate the Bidens, publicly repeating the private action that launched the impeachment probe. “The Dow Jones, which was down by more than 100 points when Trump began speaking, suddenly headed upward,” The Post's Helaine Olen wrote. “Trump potentially doubled his trouble, and the stock market went up.” 

Instead, investors have remained focused on third-quarter earnings reports, the U.S.-China trade war, the Fed’s next moves, and macroeconomic signals, among other factors. And the historical pattern indicates markets haven't suffered much in past shutdowns. The Dow rallied while the government was shuttered earlier this year. And as we noted here at the time, over the 20 prior shutdowns dating back to 1976, “the S&P 500 has posted a median return of 0 percent, according to data from LPL Financial Research. And the market has actually gained ground during each of the past five.”

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