(NEW YORK) — Stocks dropped in early trading on Wednesday, just hours after a government shutdown began, shuttering some government services and complicating a delicate moment for the nation’s economy.
The Dow Jones Industrial Average fell 87 points, or 0.1%, while the S&P 500 slid 0.4%. The tech-heavy Nasdaq declined 0.6%.
The selloff marked the first sign of shutdown-related strain for markets, which shrugged off the looming impasse a day earlier. Each of the major indexes ticked up on Tuesday, including a record high for the Dow.
The shutdown coincides with a rough patch for the U.S. economy, at least by some key metrics. A recent hiring slowdown has stoked recession fears, while inflation has proven difficult to fully contain.
Fresh hiring data on Wednesday morning deepened concern about the labor market. Private sector employment declined by 32,000 jobs in September, registering well short of economists’ expectations of 45,000 jobs added, according to data firm ADP research.
A government shutdown typically risks only modest damage for the U.S. economy, stemming mainly from furloughed public workers, who temporarily lose out on pay and put a dent in U.S. consumer spending, analysts previously told ABC News.
The impact of a shutdown could be more significant this time around, however, since the wobbly economy may strain under the weight of a potentially prolonged interruption, while a halt in the release of key economic data could make it more difficult for policymakers to steer the economy, they added.
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