A lower finish in US markets last night, along with ratings agency Fitch putting the US on negative watch, doesn’t, as yet, appear to be sowing the early seeds of anxiety that maybe US politicians lack the votes, and possibly the will to pass a debt deal by the 17th October deadline. Divisions between `Democrats and Republicans remain all too apparent as both Congress and the Senate try to arrive at bills that are not only acceptable to themselves, but also to each other. Maybe now is the time for markets to start turning the screw in order to impress upon complacent politicians that playing Russian roulette with the US economy is not the low risk strategy that many on Capitol Hill maybe think that it is. Even if equity markets aren’t concerned about the ability to pass some form of deal US short term treasury markets are, as yields continue to pike higher. While there might be the possibility of a deal between Republicans and Democrats in the Senate to raise the debt ceiling as well as reopen the government, the Congress remains a very different animal. Selling any deal to the Republican majority here has always been a major sticking point. While markets continue to remain fairly relaxed about the prospect of a deal, with Europe’s markets set to open just slightly lower, the urgency of finding a solution could well continue to remain elusive. For now it would appear that certain politicians don't really get it and while we may not get a default on 17th you can be sure that if we go beyond the deadline, which looks increasingly likely, expect investors to start voting with their feet if we don’t get a deal by the weekend. The next deadline would then be 23rd October when a $12bn social security payment is due. The pound slipped back yesterday despite the rate of CPI inflation remaining unchanged at 2.7% for September. This continued stickiness in price pressures looks sure to keep the pressure on consumer spending at a time when average earnings continue to lag behind. This mornings latest data for average earnings looks set to reinforce that gap further with a decline from 1.1% to 1% in the 3 months to August. On a more positive note the latest unemployment data could offer some comfort with the latest jobless claims numbers for September expected to show yet another monthly drop, this time in the region of around 24k. The ILO rate for the three months to August is expected to remain unchanged at 7.7%, however given the sharp drop in claims numbers seen in recent months it wouldn't be a surprise to see the rate drop to 7.6%, a mere 0.6% away from Bank of England governor Mark Carney's staging post. Back in the US the debt ceiling shenanigans continue to play out, while we got an early indication yesterday of the effects of the current government shutdown on the manufacturing sector with the latest October Empire Fed manufacturing survey which came in at 1.52, well below expectations of 6. Later this evening we get the latest "Beige Book" survey of economic conditions from the Fed regions, which could also raise some interesting questions about the state of the US economy in this new shutdown twilight zone. For all the damage that the US shutdown appears to be doing to the US economy, stock markets continue to remain fairly well underpinned in a complete dislocation from events on the ground. Equity Market Calls FTSE100 is expected to open 5 points lower at 6,544 DAX is expected to open 3 points lower at 8,801 CAC40 is expected to open 3 points lower at 4,240 CMC Markets is an execution only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.