It was a short week for markets. Monday awaited the fiscal cliff showdown in Washington; Tuesday was lost to the new year holiday. The three days left gave traders plenty of time to put on a fireworks display of market moves.

In the first hours of 2013, Washington split the difference on the $600bn-a-year fiscal tightening that would have come without a deal. They went a third of the way down the cliff, eliminated another third, and postponed the last for reconsideration in March. Across the board, markets reacted to the deal hammered out on Capitol Hill with big bounces: stocks, bonds and commodities tacked strongly from Wednesday to Friday.

Equity markets jumped after the mini-deal was announced: since the start of the year, stocks are up by more than 2 per cent in all the big markets. This undid the flagging sentiment from the end of 2012. These swings, however, are merely the last twitch on a longer upward slope. Equities have been rising since November.