Wall Street eyes end of shutdown. Now what?

Investors are rejoicing over what they see as an end to the government shutdown nearing — yet the positive vibes probably won't last for long.Why it matters: A reopening would ease one pocket of worry for Wall Street, but swing attention to the others, like sky-high valuations and signs of an AI bubble.Investors will also have to make sense soon of newly resumed government data, coming late at first and in some cases maybe not at all. (Just don't hold your breath for October CPI.) What they're saying: "None of the other issues that have been 'bothering' the market are resolved yet," Peter Tchir, head of macro strategies at Academy Securities, wrote in his latest research note. "The potential for pAIn seems real." (Yes, he capitalized AI on purpose here.)An end to the shutdown won't "solve all the stock market's problems as issues like stretched valuations, the peak in earnings sentiment and AI jitters would remain," RBC Capital Markets' head of U.S. equity strategy, Lori Calvasina, wrote in a note to clients.Zoom out: Company earnings are usually the main driver for the stock market, but earnings sentiment "peaked over the summer" Calvasina noted.While upward revisions to earnings estimates rose to 59.6% for the S&P 500 and 56.2% for the Russell 2000 last week, both remain below their August highs.Yes, but: A reopening of the government would be a positive. The shutdown's length turned it from "background noise to real economic worry," Mark Malek, chief investment officer at Siebert, wrote in a note.The government shutdown has already cut about 0.8% from quarterly GDP and about $55 billion in lost output, says EY-Parthenon chief economist Gregory Daco.What we're watching: Will Wall Street go back to watching economic data prints for clues about the Federal Reserve's next steps? And will worries of an AI bubble still keep investors up at night?

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