The good news is that the biggest fear of the Street--that the government will remain shut down until the October 17th debt ceiling deadline and may even default on its debt--seems less likely.
House Republicans--particularly House Speaker John Boehner--are signaling that the goal of de-funding or repealing Obamacare is gradually being abandoned in favor of negotiations over spending reductions, what Greg Valliere has called "a down payment on entitlement and tax reform."
There are reports that several dozen Republican might vote in favor of a clean continuing resolution bill if Mr. Boehner brought it up for a vote.
For the markets, it's not been a bad week: the S&P 500 is down only 0.8 percent, and only 2.7 percent from the September 19th historic high. That is good and bad news: Good because the markets believe some deal will be reached, yet bad because many believe that a much more aggressive sell-off would help bring everyone to the table.