Oct 16 - World stocks mark time as nervy investors cling to hopes that U.S. politicians will prevent the country defaulting on its debt. But as David Pollard reports from London, a warning from ratings agency Fitch of a possible US credit ratings cut hasn't helped those watching from afar.
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Wary, worried - but not panicking.
European investors appear to be taking the countdown to Thursday's default deadline in their stride, for now.
Credit default swaps - effectively an insurance payment against default - are at two year highs.
But - and despite ratings agency Fitch saying a US downgrade is possible - other asset classes have not seen the dips many expected.
Analyst Brenda Kelly of IG Markets.
(SOUNDBITE) (English) Brenda Kelly, markets analyst, IG Markets, saying:
"There's a lot of complacency in the market at the moment, and I think it's a lot to do with the fact that people have been expecting some sort of resolution and have been a bit fearful to either be coming out and reducing their positions, or indeed, be caught short ."
Default news if and when it happens could have a dramatic impact.
That prospect is laced with the ingredient investors traditionally hate: uncertainty.
Mike Ingram of BGC Partners.
(SOUNDBITE) (English) Mike Ingram, markets analyst, BGC Partners, saying:
"I understand that central banks and governments have been making contingency plans to try and mitigate the effects of a technical default, but as I said, we are really in unknown territory here. This really hasn't happened before in the US in living memory."
Whatever resolution comes out of this week's horse-trading in Washington, it's not likely to offer any lasting answer to the problem either.
SOUNDBITE) (English) Mike Ingram, markets analyst, BGC Partners, saying:
"Never forget as well, even if there is a resolution - and by definition now it's going to be a last-minute resolution on this whole debt ceiling issue - it's almost certainly just going to be a short-term fix."
Even if a deal is done the US could still become locked in its debt row again in January and February.
And that raises the promise of a return to the thing investors - particularly those in struggling parts of Europe - had hoped was banished.
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