Stocks closed higher after the Senate voted to shut down the government

2:29 a.m. Traders work at the New York Stock Exchange (NYSE) on November 7, 2025 in New York. Spencer Platt/Getty Images

Stocks closed sharply higher on Monday after the Senate voted hours to advance a potential deal with a government shutdown that has weighed on economic output and created uncertainty in markets for more than a month.

The Dow Jones Industrial Average closed up 380 points, or 0.8%, while the S&P 500 rose 1.5%. The Nasdaq technology index rose 2.2%.

In a rare session Sunday, lawmakers cleared a key hurdle to a potential government reopening by advancing a short-term funding bill 60-40, just shy of the threshold for passage.

Stocks recovered on Monday after major indexes posted a loss for the previous week, a rare setback that had not occurred four weeks earlier.

The economy showed some signs of strain during the shutdown.

According to data from the University of Michigan, a report released on Friday showed a drop in consumer sentiment in November, leading to the lowest level of consumer sentiment since 2022.

The survey was conducted a few days after data from the Federal Reserve Bank of New York. showed that the level of indebtedness of American households has reached a record high level.

These developments can have significant stakes for the broader economy, as consumer spending accounts for roughly two-thirds of US economic activity.

Traders work at the New York Stock Exchange (NYSE) on November 7, 2025 in New York City. Spencer Platt/Getty Images

Still, markets proved resilient during a tumultuous year marked by fluctuating tariffs, persistent inflation and a slowdown in hiring. Tech giants have defied these headwinds, fueling in part an AI investment boom.

The S&P 500 is up 14% in 2025, while the Dow is up 10%. The Nasdaq rose 19%.

The Senate reconvened Monday to continue work on ending the federal government shutdown, now in its 41st day.

There are some procedural steps needed for the Senate to pass the government shutdown deal and send it to the Republican-controlled House for potential approval.

A potential government shutdown would restore jobs and pay wages to thousands of federal employees, which is expected to provide a boost to the U.S. economy.

The federal government will also resume collecting and publishing key government dates in the event of a shutdown deal, allowing investors to watch monthly reports on inflation and employment.

The Federal Reserve is set to announce its interest rate decision early next month. The central bank has cut interest rates by a quarter of a percentage point at each of its last two meetings.

Source: abcnews.go.com