Government shutdown and still a bull market. Could this be a warning sign?

As of midnight, October 1st, the federal government has experienced its first shutdown since December 2018. Historically, during the duration of federal shutdowns, markets have experienced an average return of 0.1%. On October 3rd, just two days after the shutdown, the market continued to push to record highs, continuing the display of extreme resiliency that the market has shown throughout 2025. The US has experienced many different events that could be possible reasons for faltering confidence in the economy. Inflation has seen a rise, Trump has had continued controversy with members of the FED, firing the Commissioner of the Bureau of Labor Statistics and threatening the chairman, Active participation of the US in the war in the Middle East, the largest tariffs the US has seen since 1909, and continued war in Ukraine. And still the market has risen about 9.5% only 8 months following Trump's inauguration.

Signing of the big beautiful bill on July 4th, 2025

The trump administration's signing of the big beautiful bill is a large part of the market's performance in recent memory, as through its limiting of regulation or bureaucracy, allowing more room for growth throughout companies, as 82% of S&P companies beat EPS estimates in Q2 of 2025. Optimism in the market has stayed at a steady rate, even with the multitude of risk factors. Generally, the market is rallying under Trump's administration, but his administration is not the only cause of this boom in the market, as the AI revolution plays a key role. A perfect example is Nvidia, whose stock price has risen 51% since January of last year and continues to rise at extreme rates. They are the best producer of the most in-demand product in the world and have made billions upon billions, fueling the American market to record highs. While many continue to follow the confidence in the AI revolution, the demand may not always be there, and the ability of the top tech companies to prop up the national market may fail in the near future. This may also be true in the ability of the government, as factors like the tariffs and controversy between groups may start to catch up to us, giving way to a possible rude awakening for many investors in the future.