The US federal government is thisclose to shutting down. What will that mean for industrial stocks?
As the budget standoff threatens a federal government shutdown in the US, how will that affect industrial stocks, some of the most dependent on government spending?
On the first-ever Talking Numbers segment on CNBC's "Street Signs", a technical analyst and a fundamental analyst give their take on what it all means for the Industrial Select Sector SPDR (XLI), an ETF composed of some of the nation's biggest industrial stocks.
Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson, takes a look at the XLI's charts.
"I'm a technical analyst," says Ross. "As such, I believe prices drive the markets, not the politics."
Nonetheless, Ross believes the charts are as dismal as the politics in Washington right now.
Looking at the XLI's fundamentals is CNBC contributor Gina Sanchez, founder of Chatinco Global and advisor of $58 billion in asset allocation program assets.
"There have been 17 government shutdowns from 1976 to 1995," notes Sanchez. "And the results from the stock market was pretty much almost nothing. There was very, very little average change across the stocks."
Still, Sanchez notes that it did cause some spikes in short-term volatility. And, there are stocks in the XLI that would be affected by a shutdown.
To see more of Ross and Sanchez analyze the industrials and the XLI in particular, watch the video above.
- government shutdown
- government spending