What Happened?
A number of stocks fell in the afternoon session after investors grew anxious as the U.S. government shutdown extended into its seventh day, creating widespread uncertainty.
The political stalemate in Washington has tangible consequences for the economy and markets. A key impact is the delay in the release of crucial economic data, including the September jobs report, leaving the Federal Reserve with less information to guide its policy decisions. The shutdown is also causing direct disruptions, with staffing shortages at the Federal Aviation Administration (FAA) leading to widespread delays at major airports. This combination of economic ambiguity and real-world service interruptions has dampened investor confidence across multiple sectors.
Adding to the unease, Chief Economist at Moody's Analytics, Mark Zandi, warned that 22 states are already showing clear signs of a recession, placing the broader U.S. economy in a precarious position. Also, the latest Survey of Consumer Expectations from the New York Fed revealed that households' short-term inflation expectations are rising, while their outlook on the labor market is deteriorating. Consumers expressed greater concern about potential job losses and expect lower earnings growth, factors that directly impact discretionary spending.
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:
- Electrical Systems company Whirlpool (NYSE: WHR) fell 3%. Is now the time to buy Whirlpool? Access our full analysis report here, it’s free for active Edge members.
- Industrial Packaging company Ball (NYSE: BALL) fell 3.1%. Is now the time to buy Ball? Access our full analysis report here, it’s free for active Edge members.
Zooming In On Ball (BALL)
Ball’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 8 months ago when the stock dropped 7.7% on the news that the company reported weak fourth-quarter results, with its revenue falling below Wall Street's expectations. Weak demand in North and Central America dragged down volumes and prices. Still, its earnings per share beat expectations. Zooming out, we think this quarter was mixed yet weaker quarter.
Ball is down 11% since the beginning of the year, and at $48.47 per share, it is trading 28% below its 52-week high of $67.29 from October 2024. Investors who bought $1,000 worth of Ball’s shares 5 years ago would now be looking at an investment worth $559.97.
Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we’ve identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link.
