Stocks climbing due to debt limit rumors

No financial event happens in a vacuum, of course, so when rumors persist that lawmakers are getting close to raising the debt limit, stocks will adjust accordingly.

In this case, stocks have climbed two days in a row due to the news. An agreement to raise the debt limit would help to avoid a default, and even speculation of such an agreement has reversed the negative trend we’ve seen since the government shutdown started ten days ago.

The S&P 500 went up by .6% today, following a much more impressive jump of 2.2% yesterday, which represented the biggest daily gain for the index since January second. The two days of strong growth meant that the S&P 500 was able to finish the week up .8%, despite poor performances for the first three days of the week.

Many are still very displeased with the shutdown, of course, and Jim Russell is one of those people. Russell, who is a senior equity strategist for US Bank Wealth Management, spoke in plain terms that are very similar to what others are feeling right now.

“The quicker we can get this sideshow out of the way, the quicker that investors can focus on the actual fundamentals. It’s critical because every day that we’re hanging out there without the federal government being up and running, it damages the economy, it damages earnings, it damages investor confidence.”