What Happened?

A number of stocks fell in the afternoon session after the U.S. government hurtled toward a potential shutdown, sparking economic uncertainty and weighing on investor confidence. 

Market volatility increased as a partisan standoff pushed the federal government closer to a shutdown. If lawmakers fail to reach a spending agreement, a shutdown would begin, furloughing thousands of federal workers. This prospect has weighed on investor sentiment, creating a 'risk-off' mood in the markets as traders brace for potential economic disruption. The political uncertainty adds a layer of caution for investors heading into the final day of the month. 

Adding to the weakness, a key report showed U.S. consumer confidence unexpectedly fell to a five-month low in September. The Conference Board's consumer confidence index slid to 94.2, a steeper drop than analysts had anticipated and its lowest reading since April. This downturn reflects growing pessimism among Americans about inflation and a weakening job market. Consumer confidence is a closely watched economic indicator as it gauges households' willingness to spend. A decline suggests that consumers may pull back on discretionary purchases, such as dining out or shopping for non-essential goods, which could negatively impact the future revenues and profits of companies in these sectors.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Asset Management company Blackstone (NYSE: BX) fell 4%. Is now the time to buy Blackstone? Access our full analysis report here, it’s free.
• Custody Bank company Hamilton Lane (NASDAQ: HLNE) fell 3.2%. Is now the time to buy Hamilton Lane? Access our full analysis report here, it’s free.
• Auto Loan company Ally Financial (NYSE: ALLY) fell 2.7%. Is now the time to buy Ally Financial? Access our full analysis report here, it’s free.
• Specialty Finance company DigitalBridge (NYSE: DBRG) fell 3.3%. Is now the time to buy DigitalBridge? Access our full analysis report here, it’s free.

Zooming In On Blackstone (BX)

Blackstone’s shares are somewhat volatile and have had 10 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

Blackstone is down 1.8% since the beginning of the year, and at $170.62 per share, it is trading 14.3% below its 52-week high of $199.05 from November 2024. Investors who bought $1,000 worth of Blackstone’s shares 5 years ago would now be looking at an investment worth $3,269.

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