Investing.com — US stock futures fell in Asian trade on Friday after a stop-gap spending bill backed by President-elect Donald Trump was voted down in Congress, raising the prospect of a government shutdown.
fell 0.4% to 5,912.50 points, while down 0.5% to 21,263.0 points at 22:10 ET (02:10 GMT). fell 0.3% to 42,661.0 points. Futures extended losses after falling slightly in evening trade on Thursday.
The bill was put together at the eleventh hour by policymakers to accommodate Trump's demands for higher government spending and increased debt. But the spending bill was rejected in a 174-235 vote in the House of Representatives, with many Republican senators also openly opposing the President-elect.
The new bill replaces a bipartisan agreement to approve government spending, after Trump and Tesla (NASDAQ: ) CEO Elon Musk came out against the old agreement.
Government funding is expected to end at midnight on Friday, marking the start of a government shutdown that could disrupt operations ranging from border security to travel. Disruption is expected to worsen amid increased traffic during the holiday season.
Trump and Musk have rejected many provisions in the old bill that they see as a waste of money for Democrats. A revised version of the bill has abandoned some provisions to increase the tax bill, but to Trump's demands, the proposed limits on the national debt for two years – a condition that will make it easier to pass the tax cuts he promised.
The government shutdown casts another layer of uncertainty on Wall Street, which was already reeling from losses earlier this week after the Federal Reserve cut interest rates but signaled a slower pace of rate cuts through 2025.
The focus this Friday is again on key data coming in November. The reading is the Fed's preferred gauge of inflation, and is likely to take into account the outlook for interest rates.