US budget deal gets market thumbs-up

Financial markets gave a cautious thumbs-up on Wednesday to a provisional budget deal that should end the threat of the US government shutting down again in the coming months.

News that US budget negotiators had reached a two-year agreement was not enough to overcome the year-end blues in Asia, but it was more warmly received in Europe, where shares inched higher and the dollar began to firm. For many investors, the deal carried dual significance. It removed a key uncertainty hanging over markets, and it heightened expectations that the US Fed will soon start scaling back its $85 billion-a-month stimulus program.