Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., Sept. 15, 2025.
Brendan McDermid | Reuters
U.S. stocks fell Monday following a strong week for the major averages, in which the Dow Jones Industrial Average and S&P 500 closed at fresh all-time highs.
The Dow Jones Industrial Average shed 161 points, or 0.3%. The S&P 500 slipped 0.2%, and the Nasdaq Composite lost 0.1%.
The growing risk of a government shutdown added to the downbeat sentiment. Last week, the Senate rejected Republican and Democratic proposals to at least temporarily fund the federal government. Senate Democratic Leader Chuck Schumer has since urged President Donald Trump to meet with Democrats to strike a deal.
These developments come as the deadline for lawmakers to fund the government is Sept. 30.
The stock market is coming off a solid weekly advance, with the three major indexes hitting all-time highs. The small-cap Russell 2000 also posted its first record close since November 2021.
Last week also saw the Federal Reserve cut interest rates by a quarter percentage point, its first reduction since December. It was a widely anticipated decision that, after some initial volatility, investors took to mean the central bank has taken a dovish tilt amid rising signs of a slowing labor market.
Markets are now pricing in two more quarter-point cuts between now and the end of the year, according to the CME FedWatch Tool. Investors will review upcoming macroeconomic data with even more care to ensure that the expected path of monetary easing remains intact.
“With equities near the highs and rates markets still pricing in [roughly] 5x additional cuts over the next year, further support for equities will hinge more on robust incoming macro data than on more dovishness in rates, in our view,” Barclays head of European equity strategy Emmanuel Cau wrote on Friday.
The coming week will bring the latest personal consumption expenditures price index — the Fed’s preferred inflation measure — which is expected to show elevated pricing pressures. Investors expect inflation to remain tame enough for the Fed to maintain its current stance on monetary policy.
