Starbucks, the coffee chain, and the Gap, a clothing outlet, closed stores throughout the country. Major sporting events were also cancelled. All US airports were shut down in the wake of the attacks, and were set to remain closed through much of the following day. The collective impact of these shutdowns is almost certain to reduce economic growth in the third quarter, although much of the commercial activity is likely to be deferred rather than cancelled. We would also expect other first order effects from the terrorist attacks, especially on the financial services industry.
Corporate finance is likely to be stalled for some time by the disruptions.
Equity and bond issues and merger and acquisition activity will be limited, in part because a portion of the US financial infrastructure was destroyed in the attacks. Indeed, any significant tapping of the capital markets will not be possible, at least for the short term. The more general concern over liquidity prompted central banks to inject capital into the money markets on September 12th. Indeed, we now expect the Fed to add another 25 basis point rate cut to the one we had been forecasting before the attack. US stock markets are likely to fall sharply when they re-open.