The sharemarket was set to lose ground this week - but then it rose on Friday as investors responded to news that US politicians might avoid a collision on the debt ceiling.
Friday's rally helped the local market close nearly 0.5 per cent higher for the week - not bad given the previous four days had been dominated by talk of a seemingly deadlocked US Congress.
"Investors are piling back in," Australian Stock Report head of research Geoff Saffer said on Friday. "Today's gains are being driven by the first sign of compromise in the US debt ceiling political deadlock."
For the week, the benchmark S&P/ASX200 rose 22.9 points, or 0.4 per cent, at 5230.9 points, while the All Ordinaries rose 23 points, or 0.4 per cent, at 5228.8 points.
Market watchers were surprised that local investors had been reacting so calmly through the week to all the uncertainty about the state of US politics. Some put it down to complacency, others to the feeling that we have seen this before in the US and that it is nothing new.
Then late in the week, global equity markets rose as House Republicans in the US proposed to raise the US debt ceiling until November 22, but not to reopen the government. It provided the "good news" investors were waiting for.
"Despite these rather substantial caveats, equities rallied as though the whole crisis had been resolved," Westpac strategist Sean Callow wrote on Friday. "The S&P 500 closed up 2.2 per cent as did the Dow, 323 points. The Euro Stoxx 50 also jumped 2.2 per cent."
And as economists pointed out, the "worry list" for markets seems to have diminished lately, with concerns about the German election, the Syrian civil war, the replacement of Ben Bernanke as chairman of the US Federal Reserve and the US Fed's decision to slow (or not to slow) the rate of money printing all fading from the front pages or been resolved positively.
Meanwhile, economists said news that US Fed vice-chairman Janet Yellen - a co-architect with Bernanke of the Fed's response to the global financial crisis - had been confirmed as the nomination to replace Bernanke was viewed well by markets. It also removed a risk that had been bothering financial markets for a while.
"Janet Yellen presents continuity more than any plausible candidate," Saul Eslake, chief economist at Bank of America Merrill Lynch, said.
"Markets have priced that she is, at this stage, more 'dovish' than Larry Summers would have been ... but she hasn't always been. I think she rightly recognises that inflation is the last of the Fed's problems at the moment and that there's still a long way to go in reviving growth."
For the week, Bank of Queensland rose 52¢, or 4.9 per cent, at $11.10, after the bank lifted its full-year cash profit to $251 million due to a reduction in bad debts.
Cash Converters fell 4¢, or 3.6 per cent, at $1.21. The lender and second-hand goods retailer is facing a class action for allegedly charging extremely high interest rates.
Leighton Holdings rose $1.05, or 6.3 per cent, at $17.79, despite its bribery scandal prompting Melbourne lawyer and investor Mark Elliott to sue the construction firm.
Westpac Bank rose 57¢, or 1.8 per cent, to $32.99, after it announced that it will pay $1.45 billion to purchase Lloyds Banking Group's Australian motor and equipment finance business.
Woodside Petroleum rose 10¢, to $38, after it announced that it had started its $5 billion North Rankin redevelopment project and exported its first gas to the Karratha gas plant.
Transurban rose 24¢, or 3.5 per cent, to $7.04. The toll road owner has recorded a 14 per cent rise in revenue for the three months to the end of September, thanks in part to the end of upgrade work on Sydney's M2 Motorway.