US Debt Ceiling Hopes Shore Up Markets Again - Los Angeles News | FOX 11 LA KTTV

US Debt Ceiling Hopes Shore Up Markets Again

Posted: Updated:

By PAN PYLAS

Associated Press

LONDON (AP) - Indications that a deal to increase the U.S. debt ceiling may be imminent shored up markets once again on Friday.

Stocks have rallied over the past day or so amid signs that the White House and Republicans in Congress were inching toward a deal that would avoid a possible U.S. debt default, though not necessarily an end to the partial shutdown of the government.

With the Oct. 17 deadline to increase the debt ceiling looming, Republican leaders said they would vote to extend the government's borrowing authority for six weeks. A spokesman for President Barack Obama said he would "likely" sign a bill to increase the nation's ability to borrow money.

A failure to increase the debt ceiling raises the prospect of a U.S. debt default that could derail the global economic recovery and prompt turmoil in financial markets. For most of the past couple of weeks, investors have been wary, rather than panicky, about that possibility, so the prospect of a resolution - however short-term - has prompted a relief rally that's carried on into Friday's trading.

"The 'constructive' talks between the Republicans and Democrats yesterday and the indications that these will be continued today has strengthened hopes that the U.S. debt ceiling could be raised before the start of next week; even though there is currently risk that this solution could prove to be temporary," said Jane Foley, an analyst at Rabobank International.

In Europe, the FTSE 100 index of leading British shares was up 0.7 percent at 6,477 while Germany's DAX rose 0.3 percent to 8,715. The CAC-40 in France was 0.1 percent higher at 4,221.

Wall Street was poised for a steady opening, following Thursday's big gains that saw the Dow Jones industrial average add a whopping 300 points - Dow futures and the broader S&P 500 futures were up 0.1 percent.

Developments in Washington will remain the focus of attention, especially as monthly retail sales data for September have been postponed because of the government shutdown, which is into its second week. In the currency markets, the euro was up 0.3 percent at $1.3572 while the dollar rose 0.2 percent to 98.33 yen.

Earlier, Asian markets advanced in the slipstream of Thursday's developments. Japan's Nikkei 225 stock average rose 1.5 percent to 14,404.74 and Hong Kong's Hang Seng added 1.2 percent to 23,218.32. Australia's S&P/ASX 200 climbed 1.6 percent to 5,230.90. China's Shanghai Composite Index rose 1.7 percent to 2,228.15.

Even if U.S. politicians agree some sort of deal, it seems it won't be long before the next deadline arrives. The U.S. budget deadlock could be the dominant theme for the rest of the year.

"It would appear that U.S. lawmakers are not a huge fan of national holidays," said Craig Erlam, market analyst at Alpari. "Last year they effectively canceled Christmas in order to avoid going over the fiscal cliff, now it looks as though Thanksgiving will be the next casualty as the extension would push the deadline back to the end of November."

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  • Federal Government ShutdownMore>>

  • How Shutdown Affected The Day To Day

    How Shutdown Affected The Day To Day

    Friday, October 18 2013 7:23 AM EDT2013-10-18 11:23:32 GMT
    Our food was a little less safe, our workplaces a little more dangerous. The risk of getting sick was a bit higher, our kids' homework tougher to complete.
    Our food was a little less safe, our workplaces a little more dangerous. The risk of getting sick was a bit higher, our kids' homework tougher to complete.
  • Obama To Seek Opening With GOP Leaders On Shutdown

    Obama To Seek Opening With GOP Leaders On Shutdown

    Thursday, October 10 2013 7:06 AM EDT2013-10-10 11:06:32 GMT
    By ANDREW TAYLOR Associated Press WASHINGTON (AP) - President Barack Obama is hosting top House Republicans to seek an opening in an impasse that has shuttered much of the government and threatens a
    By ANDREW TAYLOR Associated Press WASHINGTON (AP) - President Barack Obama is hosting top House Republicans to seek an opening in an impasse that has shuttered much of the government and threatens a
  • HUD Employees Protest Government Shutdown In Philly

    HUD Employees Protest Government Shutdown In Philly

    Wednesday, October 9 2013 4:29 PM EDT2013-10-09 20:29:53 GMT
    We're now nine days into the government shutdown, and many government workers are still on furlough.
    We're now nine days into the government shutdown, and many government workers are still on furlough.
  • Local NewsMore>>

  • Rally Of Solidarity For Israel Held In LOVE Park

    Rally Of Solidarity For Israel Held In LOVE Park

    Wednesday, July 23 2014 11:44 PM EDT2014-07-24 03:44:30 GMT
    SkyFOX was live over the scene shortly after 5 p.m. on Wednesday, as big crowd gathered at LOVE Park in Philadelphia after area synagogues put out the call to stand with Israel.
    SkyFOX was live over the scene shortly after 5 p.m. on Wednesday, as big crowd gathered at LOVE Park in Philadelphia after area synagogues put out the call to stand with Israel.
  • California firm issues nationwide fruit recall

    California firm issues nationwide fruit recall

    Wednesday, July 23 2014 10:07 PM EDT2014-07-24 02:07:41 GMT
    A Central California company is recalling specific lots of its fresh peaches, plums, nectarines and pluots sold nationwide over concerns of possible listeria contamination.Wawona Packing Co. President Brent Smittcamp said in a statement that he is not aware of any illnesses caused by the fruit, and the voluntary recall was announced after consulting with the U.S. Food and Drug Administration."By taking the precautionary step of recalling product, we will minimize even th...
    A Central California company is recalling specific lots of its fresh peaches, plums, nectarines and pluots sold nationwide over concerns of possible listeria contamination.Wawona Packing Co. President Brent Smittcamp said in a statement that he is not aware of any illnesses caused by the fruit, and the voluntary recall was announced after consulting with the U.S. Food and Drug Administration."By taking the precautionary step of recalling product, we will minimize even th...
  • Ocean crash kills teen pilot seeking world record

    Ocean crash kills teen pilot seeking world record

    Wednesday, July 23 2014 9:30 PM EDT2014-07-24 01:30:39 GMT
    His pilot's license fresh in his hands, an Indiana teenager set out in June for the adventure of a lifetime: an around-the-world flight with his father designed to break a record and raise money to build schools in his father's native Pakistan.
    His pilot's license fresh in his hands, an Indiana teenager set out in June for the adventure of a lifetime: an around-the-world flight with his father designed to break a record and raise money to build schools in his father's native Pakistan.
Powered by WorldNow

KTTV FOX 11
1999 S. Bundy Dr.
Los Angeles CA 90025

Main: (310) 584-2000
News Tips? (310) 584-2025

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | Terms of Service | Ad Choices