US index futures rallied on Sunday evening amid reports that Congress is close to reaching an agreement to end the longest shutdown in US history. After a challenging week in which the technology sector weighed down the market, investors appear ready to embrace a cautious sense of optimism.
S&P 500 futures gained 0.4% to 6,782 points, Nasdaq 100 futures climbed by 0.6% to 25,314, and Dow Jones futures rose by 0.3% to settle at 47,230 points. While the gains are modest, they represent a significant achievement following a week of sell-offs.
The Senate is preparing to conduct a test vote on a short-term funding bill aimed at extending government operations until January 30. The media claims that Democrats are expected to provide sufficient support for its passage.
The shutdown has now lasted 40 days, becoming the longest in US history. Disputes over healthcare subsidies have left thousands of federal workers without jobs, delayed key economic data, and pushed airports and government services to their limits.
Investors hope that a compromise will alleviate political pressure and clarify economic prospects, especially amid rising concerns about growth rates and employment.
The uptick in futures also coincided with the market's efforts to stabilize after significant losses. Last week, the S&P 500 fell by 1.6%, the Nasdaq declined by 3%, and the Dow dropped by 1.2%.
Selling activity in the tech sector intensified following warnings of overheating surrounding artificial intelligence, with Nvidia shares falling by 7% and both Apple and Microsoft facing pressure.
As Congress negotiates funding, the market grapples with reality. Any hint of a compromise is seen as a catalyst for growth, even if it only translates to a 0.4% gain.
