Considering the looming deadline of the debt default the market is acting pretty sanguine. I think the market is operating under the viewpoint that a voluntary debt default is so absurd that even our politicians are not capable of such folly. Maybe the market is under-estimating them. One can make case that until the market falls, lawmakers are not going to be pushed to make a deal. So I do think there is a reasonable chance that we could see a big drop for a day which pushes the lawmakers to extend the debt limit.
In other news, the earnings season is progressing quite well. Companies continue to beat earnings estimate and there is very little evidence that the soft patch in the US economy is hurting the bottom line of large corporations. I have seen some instances where higher commodity costs have hurt the profit margins of a few companies.