Markets rally if the debt agreement, downgrade dagli occhi (Reuters)

NEW YORK (Reuters)-if the debate in Washington over raising the debt ceiling Us finally ends with a deal on Sunday, the last-minute truce could spark a rally relief when open global markets.

U.S. lawmakers were close to a deal last-gasp 3 billion dollars to raise the debt limit and avoid default is potentially catastrophic. Markets have been protracted discussions during the tumultuous, with Wall Street, ending its worst week in a year on Friday.

"An affair of 2.8 billion looks like the result and the mechanism is in place and, with no default. This is enough to rally the markets, "said David Kotok, chief investment officer of Cumberland advisors in Sarasota Florida.

But the White House stressed that no deal had been reached yet. Communications Director Dan Pfeiffer sounded a note of caution, saying in a tweet on Sunday that "a lot of bad information is floating out there."

Wayne Kaufman, Chief market analyst at John Thomas financial, New York, said that after five days of Wall Street, the stock market was primed for a bounce. But he warned that options traders, they have been a deal will be struck, bets may remain trapped.

"There is a possibility that this could go on for another couple of weeks," he said. "Probably it would be devastating for the markets, but there is a possibility".

Even if an agreement is struck soon, the markets remain nervous, and a prominent pop in action can be short-lasting. This year, Wall Street was quick to move from crisis to crisis. And those seem to be almost infinite supply.

The United States still faces a possible downgrade in its credit rating AAA gold in the near future and that is likely to affect markets if it happens at the end.

"The initial shock of downgrade will rattle the markets," said Peter Cardillo, Chief market Economist at Avalon Partners, New York. "The possibility of a downgrade are certainly now more than a month ago."

Trading activity in recent weeks suggests U.S. equities have been restrained by paralysis in Washington.

Fears that a Government could be hamstrung a deadweight on growth rose on Friday after a report showed that the American economy grew far more slowly than thought in the first half of the year.

A number of major investors have indicated they are in possession of larger cash positions than usual, and yields on some debt of the United States in the short term, maturing in August climbed.

Meanwhile the dollar safe haven in the world during the financial crisis of 2008, hit a record low against the Swiss franc and a trough four months against the Japanese yen on Friday. Both are now seen as a more secure location to store the money of the United States.

The lack of a budget agreement would also ratchet U.S. to exert pressure on the dollar against the yen so much that raises the prospect that Japan might intervene to stop its currency from strengthening.

The dollar is on Friday to its lowest since coordinated actions to weaken the Japanese currency in mid-March. Is now in the distance of its record low of 76,250 yen, which it struck shortly before authorities intervened then.

Short-term money markets were involved, making it more expensive for banks and companies. If that persists, consumers and small businesses can also find more difficult to access credit. Who can get loans will probably pay more for them.

Companies, meanwhile, are hardly likely to ramp up hiring if funding costs are rising. It has become even more of a concern after data showed the US economy grew at a plodding pace 1.3 percent in the second quarter and produced nearly flat growth in the first quarter.

"This is exactly what the market does not need as economic conditions are shaky," Jim Caron, head of global interest rate to Morgan Stanley, said in a research note.

Ironically, he gathered more dated Treasury debt, partly in reaction to weaker than expected, but also reflecting a "flight to safety" as investors move out of the way of default can have consequences that global markets.

(Additional reporting by Angela Moon and David Gaffen; Editing by Chris Sanders and Dale Hudson)

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