Live updates, news and analysis

European markets were slightly higher during early morning deals, as global investors monitor the U.S. government shutdown.

The pan-European Stoxx 600 index was up 0.1% shortly after the opening bell, with sectors and major bourses pointing in opposite directions.

— Chloe Taylor, Tasmin Lockwood

Market participants are likely to brush off the impact of the government shutdown, according to Luke Bartholomew, deputy chief economist at Aberdeen, particularly if it proves to be a short-term issue.

Asked whether investors were likely to take issue with the shutdown, Bartholomew replied: “Probably not, to be honest. I mean, if it was bound up with the debt ceiling issue as they have been in the past then potentially there’s risks around that, but I would be surprised if the market doesn’t ultimately shrug this off.”

Bartholomew conceded there are questions about data availability, with the closely watched nonfarm payrolls report not expected to be released on Friday because of the shutdown.

“Maybe that influences the Fed in some way. Although they do have a wide variety of other private sector data that they can rely on,” Bartholomew told CNBC’s “Squawk Box Europe.”

— Sam Meredith

Republicans, who hold the White House and slim majorities in both chambers of Congress, wanted to pass a stopgap bill to maintain funding at current levels until late November. They needed at least seven Democrats to help them in the Senate, where 60 votes are required to overcome the filibuster.

Senate Minority Leader Chuck Schumer, D-N.Y., and a group of Democrats had previously joined Republicans in March to pass a six-month extension of government funding.

But this time around, Democrats have united around several demands, including that any short-term funding bill include an extension of enhanced Obamacare tax credits, which are due to lapse at year’s end. The enhanced subsidies reduce the costs of health insurance premiums for a wider swath of Affordable Care Act enrollees.

Republicans balked, accusing Democrats of holding the government hostage by standing in the way of continued federal funding unless their health-care demands are met.

GOP leaders have also argued that their “clean” continuing resolution is nonpartisan, and that policy negotiations can continue without shutting down the government.

Democrats countered that the GOP proposal actually is partisan, since Republicans are seeking to extend funding following the passage of a controversial spending bill that narrowly passed in July over the objections of all congressional Democrats.

Democrats have also slammed Republicans for refusing to negotiate, and for leaving Washington, D.C., as the shutdown deadline approached.

Trump and other Republicans have also accused Democrats of seeking to give health-care benefits to undocumented immigrants — a claim that Democrats reject as a lie, noting that federal law prohibits it.

— Kevin Breuninger

While insisting that Republicans do not want to shut the government down, Trump said his administration could exploit the situation to hurt Democrats.

“We can do things during the shutdown that are irreversible, that are bad for [Democrats],” Trump said at the White House on Tuesday, “like cutting vast numbers of people out, cutting things that they like, cutting programs that they like.”

That could include cutting “large numbers of people” on government benefits, Trump said, before quickly adding, “We don’t want to do that, but we don’t want fraud, waste and abuse.”

— Kevin Breuninger

“Democrats Have Shutdown the Government,” a White House webpage said right after midnight, featuring a clock detailing the time that has passed since the shutdown began.

But California Gov. Gavin Newsom, a Democrat, said on X, “Donald Trump just shut down the government,” underscoring the fact that both parties blame the other for the dramatic pause in federal services and functions.

Former Vice President Kamala Harris posted on X: “President Trump and Congressional Republicans just shut down the government because they refused to stop your health care costs from rising. Let me be clear: Republicans are in charge of the White House, House, and Senate. This is their shutdown.”

— Dan Mangan, Riya Bhattacharjee

During the last full government shutdown in 2013, about 850,000 federal employees were furloughed, meaning they were required to take unpaid leave, according to the Committee for a Responsible Federal Budget.

The Congressional Budget Office estimated Tuesday that the current shutdown would lead to about 750,000 employees being furloughed.

“The total daily cost of their compensation would be roughly $400 million,” the CBO told Sen. Joni Ernst, R-Iowa, in response to her request for information on the impact of a shutdown.

The agency’s estimate noted that the number of furloughed employees could vary from day to day “because some agencies might furlough more employees the longer a shutdown persists and others might recall some initially furloughed employees.”

Furloughed workers will get back pay upon their return.

But Trump’s Office of Management and Budget has threatened to make some of those job cuts permanent, by warning federal agencies in a recent memo to prepare for mass firings in the event of a shutdown.

— Kevin Breuninger

The full shutdown began at midnight Wednesday after Democratic and Republican leaders failed to agree on even a short-term deal to keep the government fully funded past the current fiscal year.

It is unclear just how long the shutdown will last, or how widespread its impacts will be.

The federal government has either shut down or experienced funding gaps 14 times since 1980.

The longest shutdown on record started in late 2018, when the government partially shuttered for about five weeks amid disputes over funding Trump’s proposed U.S.-Mexico border wall.

— Kevin Breuninger