US shutdown nears possible end as Senate clears key vote

​​​Record-breaking shutdown edges towards resolution

​The United States government shutdown that began on 1 October 2025 moved closer to ending on 9 November after the Senate cleared a crucial procedural vote 60-40. At 40 days, this already stands as the longest shutdown in American history.

​However, the closure isn't over yet. The funding legislation still requires full Senate passage, House of Representatives approval and the presidential signature before federal agencies can fully reopen.

​This shutdown has already eclipsed the previous record of 35 days set during the 2018-2019 closure. The extended duration has raised concerns about economic disruption, though market reactions have proved more muted than many feared.

​Historical data compiled by Carson Investment Research reveals that government shutdowns have occurred 24 times since 1976. The average length stands at just 8.2 days, with a median of four days, highlighting how exceptional this episode has become.

​Senate vote advances funding bill forward

​The legislation under consideration would fund federal agencies until 30 January 2026. It includes a "minibus" package combining three separate appropriations bills covering military construction, veterans affairs, agriculture and the legislative branch.

​Moderate Democrats agreed to support the measure after securing a commitment for a December vote on extending healthcare subsidies. These Affordable Care Act premium tax credits represent a key priority, though passage remains uncertain.

​The 60-40 vote cleared a procedural hurdle but doesn't guarantee final success. Congressional negotiations remain fluid, with various sticking points that could yet derail the process before it reaches completion.

​Republicans continue to express concerns about the balance between long-term funding and stop-gap measures. Some members prefer shorter continuing resolutions that allow more frequent policy adjustments and spending reviews.

​Markets rally on hopes of imminent resolution

​The S&P 500 has gained 0.6% during the shutdown period so far, slightly above the historical average return of 0.3%. This performance aligns with data showing that 54.5% of shutdowns see positive equity returns whilst ongoing.

​Global equity markets rallied sharply on the Senate vote news, interpreting the progress as significantly reducing the probability of a prolonged closure. European indices joined the advance as political risk premiums began to unwind.

​Technology stocks and cyclical sectors led the gains, with traders rotating into growth-oriented areas of the market. This sector leadership typically signals improving confidence about economic prospects and corporate earnings trajectories.

​The breadth of the rally across markets demonstrated genuine conviction rather than short-covering. Trading volumes picked up as institutional investors repositioned portfolios to reflect the improved outlook for government funding.

​Historical patterns suggest strong gains after shutdowns end

​Perhaps the most encouraging data for investors lies in forward-looking returns following shutdown resolutions. Historical analysis shows the S&P 500 delivered positive returns in the 12 months after 86.4% of previous shutdowns.

​The average 12-month return after shutdowns stands at 12.7%, with a median of 12.3%. This suggests that once political uncertainty clears, equity markets typically perform well over the subsequent year.

​Notable examples include the 36.2% gain following the brief October 1982 shutdown and the 25.8% advance after the May 1980 closure. Even longer shutdowns have preceded strong market performance, with the 35-day 2018-2019 shutdown followed by 23.7% gains.

​The worst 12-month outcome occurred after the September 1976 shutdown, which saw a 6.6% decline. However, this remains an outlier, with the vast majority of post-shutdown periods delivering positive returns for equity investors.

​Party control shows mixed impact on outcomes

​The historical data reveals no clear pattern linking party control of government to shutdown outcomes or subsequent market performance. Shutdowns have occurred under various configurations of presidential and congressional control.

​The Reagan presidency saw multiple brief shutdowns with generally positive market outcomes. The 1995-1996 shutdown under Clinton lasted 21 days but was followed by 21.3% gains, whilst the 2013 Obama-era closure preceded 8.9% returns.

​More recent shutdowns under Trump in 2018 showed differing results. The brief February closure saw modest gains, whilst the record 35-day shutdown from December 2018 to January 2019 delivered strong forward returns despite initial concerns.

​The current Republican control of both presidency and Congress mirrors the configuration during several historical shutdowns. However, the partisan makeup appears less important than the eventual resolution and broader economic conditions.

​Risks remain despite Senate progress

​Material risks persist that could yet prevent the funding agreement from becoming law. The House of Representatives faces its own set of political dynamics that may differ from Senate considerations.

​Individual members could demand changes to the legislation that prove unacceptable to Senate negotiators. Such amendments might necessitate another round of negotiations and votes, potentially extending the shutdown timeline further.

​The presidential signature requirement adds another variable to the equation. While executive approval seems likely given the bipartisan nature of the compromise, unexpected objections remain theoretically possible

​Market participants should remain alert to potential setbacks even as they celebrate progress. The coming days will prove critical as the legislation moves through remaining procedural steps towards potential enactment.

​Global markets react to reduced uncertainty

​European equity markets joined the rally as news of the Senate vote spread. The FTSE 100 advanced alongside broader indices, with cyclical sectors leading gains as political risk premiums unwound.

​Banks, industrials and consumer discretionary companies benefited from the improved sentiment. These economically sensitive areas had underperformed during the shutdown as investors worried about potential disruptions to government services and spending.

​US indices posted particularly strong gains as domestic concerns eased. The Senate's ability to advance the measure without full consensus signalled that a government reopening was drawing nearer.

​Government bond yields rose as safe-haven demand moderated following the vote. US Treasuries experienced selling pressure across the curve, with investors rotating capital back into riskier assets.

​What the data suggests if shutdown ends

​The historical track record of post-shutdown returns provides encouraging context for investors, though past performance doesn't guarantee future results. The 86.4% success rate over 12 months reflects markets' tendency to refocus on fundamentals once political drama subsides.

​The average 0.3% return during shutdowns themselves masks considerable variation. Some closures saw sharp equity declines, whilst others produced gains. The current 0.6% return sits comfortably above average despite the record length.

​If this shutdown resolves as expected, historical patterns suggest equity markets could perform well over the subsequent year. However, the actual outcome will depend on broader economic conditions, corporate earnings and Federal Reserve (Fed) policy.

​Gold prices have steadied as traders balance reduced safe-haven demand against ongoing monetary policy speculation. Some investors maintain precious metals exposure as insurance against potential volatility.