Germany drew ever closer to its political goal of forming a grand coalition on Sunday, but the news failed to ignite market confidence across Europe as global investors looked Stateswards at the potential impact of the US government shutdown.
After a four-month political deadlock, however, the step towards formal coalition talks was welcomed warmly by the chief protaganists: Angela Merkel and her Christian Democrats (CDU) and the Social Democratic Party (SPD) and its leader Martin Schulz.
While a majority voted in favour of coalition talks that would grant Merkel a fourth-term as German Chancellor, the poll result was closer than many had expected - 362-280 - leading some to suspect that the talks could get prickly.
Schulz said: “Europe is waiting for a Germany that takes responsibility for Europe and that acts decisively. Without the SPD, that won’t be possible.”
Potential sticking points
Merkel is keen to stress tighter controls on immigration after voters deserted the CDU in favour of the far-right Alternative for Germany (AfD) party.
The SPD, however, stood at September's inconclusive general election for a more open immigration policy. The two parties have made some concessions over the issue, agreeing earlier this month to a limit of an annual 200,000 asylum seekers.
Should the talks - which Merkel wants to conclude by 12 February - fail, then the CDU would have limited options: Merkel could pursue a much weaker, minority coalition with the Green party, or signal a return to the polling booths.
The former option would still require some support from the SPD, and it is suspected that Merkel would favour the latter option should these talks fail.
The euro gained some support as European traders came on line. The currency climbed 0.11% against the dollar to $1.2233 having spent much of previous 12 hours lower.
European stock markets, however, were expected to start the session subdued over the potential economic impact of a US government shutdown.