3 Things: OpenAI, markets, latest on shutdown

OpenAI becomes the world's most valuable startup. The Chat GPT owner is now worth $500 billion. Equity markets (^DJI, ^GSPC, ^NDX) shrugged off the start of the shutdown and rose after ADP data showed that the labor market remains weak. President Trump has ramped up the pressure on democrats by targeting blue states when it comes to funding cuts as the government shutdown rumbles on. Yahoo Finance's political correspondent, Ben Werschkul breaks down the latest developments and looks ahead at whether a speedy resolution can be found. For more live coverage of markets watch the full episode of Market Sunrise and head to Yahoo Finance.

Video Transcript

00:03 Speaker A

Well, the first thing you need to know is that Open AI has become the world's most valuable startup. The chat GPT owner has completed a deal to help employees sell shares in the company at a $500 billion valuation. That means it is now more valuable than Elon Musk's SpaceX, which is worth just a mere $400 billion. Current and former Open AI employees sold about $6.6 billion of stock to investors that included T-Ro Price and Softbank.

00:23 Speaker A

Now, the next thing you need to know is that equity markets seem to have shrugged off the government shutdown. This is where the markets closed last night. So let's take a look. Now, stocks teetered throughout the day on Wednesday, but ended in the green with the Dow Jones and S&P 500 hitting record highs. Now, as we know, there'll be no jobs report on Friday, but yesterday we did get the ADP report. It confirmed signals that a labor slowdown is afoot,

00:50 Speaker A

cementing bets that more interest rate cuts will land this year despite sticky inflation.

00:54 Speaker A

And the last thing you need to know is that the Trump administration is ramping up its pressure on Democrats as the shutdown enters its second day. The White House has frozen $18 billion in New York City infrastructure projects, and a total of $8 billion in climate-related projects in 16 states that voted for Kamala Harris in 2024 have either been paused or canceled. As many as 750,000 government workers are facing being furloed too.

01:21 Speaker A

Well, to get more on the latest on the shutdown, I'm joined by Yahoo Finance's political correspondent, Ben Werl. Ben, thanks for joining us here on Market Sunrise. Now, I mentioned how Trump seems to be ramping up the pressure on Democrats during this shutdown, but there's more to it than just that, isn't it?

01:41 Ben Werschkul

For sure. Yeah, one of the one of the interesting themes of this week we're seeing from Trump is kind of an all systems go approach on economic issues in the shutdown. The Trump overnight again described the shutdown as an opportunity for Republicans to save billions of dollars. The word he used was deadwood that they could cut out. This is a reference to his idea for mass firings, but it's emblematic of a kind of larger economic approach.

02:08 Ben Werschkul

One thing people may not realize, were the government shut down, tariffs are still being rolled out and and tariff investigations which are important are still going on. Trump is still making plans for a $20 billion dollar currency swap with Argentina. All these things are going forward as part of a we're not going to let it the shutdown slow us down. It's part of an effort to up the political pain on Democrats as much as possible, but also to achieve some some policy ends that Trump has been talking about for months.

02:37 Ben Werschkul

All this comes of course, as the economic effects of the shutdown are beginning to be be felt. The jobs report was scheduled to go out tomorrow. At this point, given the status negotiations, there's there's more or less no chance that happens. The data again is still be has been gathered, but it's going to be delayed at least for a couple days. And so we're going to start to see these economic rollouts as Trump himself clearly is not slowing down on his priorities.

03:00 Speaker A

And Ben, what about the political implications at the moment? We had a failed vote yesterday. Are we expecting any more attempts today?

03:07 Ben Werschkul

So today, today there's talks are going to continue, but it's the it's Yom Kippur. So, so there's not expected to be any votes in the Senate. They're there they're there will be back and forth, but I think the overall sense here is folks are settling in for what could be at least a few days shutdown, perhaps perhaps even longer. The Senate will be back tomorrow, so there's going to be more votes there, but this could be another repeat of what we've seen of kind of failed votes on both sides and and no

03:39 Ben Werschkul

compromise plan in the offing. A lot of folks are looking towards Monday as the next time when all lawmakers are going to be back in Washington. All talks could could go forward. Things could change. One one detail for tomorrow is that Senate majority leader John Thune and Senate minority leader Chuck Schumer could meet. This would actually be one of the first times they've met since that White House meeting that that didn't go so well. So there could be progress on there, but the actual

04:05 Ben Werschkul

implementation of of the end of a shutdown, I think we're talking about days as opposed to hours for certain.

04:14 Speaker A

Now, what about federal jobs? Are we right to be just talking about furloed workers or will we see mass firings that Trump has spoken about in the past.

04:22 Ben Werschkul

Yeah, so this is this is the kind of one of the big X factors that's different about this shutdown. I've covered a lot of shutdowns over my career and this one is this is the main difference here. There's about 750,000 furload workers. These are workers that are being sent home, stopping to work, stopping stopping their pay with the idea usually that they come back at the end. There's a large universe about two or three times that of of federal workers who are being asked to stay on the job

04:52 Ben Werschkul

without without pay, but but continue their work. You think TSA agents, things like that. All of these workers are operating under this cloud of uncertainty about this mass firings question. Trump in his post overnight was talking about him again. His budget chief Rose Vo has talked about how these could start within a day. This could start today, tomorrow. He gave a one to two day deadline, so that could begin. I I will say there is some skepticism about exactly what these look like and how deep

05:23 Ben Werschkul

Trump the Trump team is willing to go. Other Trump officials talk about this as less less dramatic than you might think. There was a one from his top economic aid talked about this as restructuring HR departments, which is a very different thing than cutting billions of dollars. So exactly how this works out remains to be seen, but it's definitely weighing on the workforce at this time. There's reports of workers being sent home with different with different computer setups so that they could be potentially notified for this. So there's a lot of questions about how this works out and how quickly it works out depending on how long the shutdown goes for certain.

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