The combination of unease in Europe and political bickering in Congress set equity markets on edge last week. In spite of the turbulence, key indices still managed to close positive for the week, with the S&P 500 gaining 0.5 percent, the Dow gaining 0.12 percent, and the Nasdaq gaining 1.5 percent. Markets slid Friday after comments by House Speaker John Boehner indicate that fiscal cliff talks have stalled. While the Democrats are seeking $1.6 trillion in tax increases (aimed largely at wealthy taxpayers), as well as $50 billion in additional stimulus spending, Republicans are focused on reducing the deficit through closing tax loopholes and reducing entitlement programs. Since these are essentially the same issues that have been argued over the last year, it seems as though lawmakers are more interested in theatrics than in resolving the issue before the end of the year.A Greek aid deal was finally reached Tuesday as European ministers convinced a skeptical International Monetary Fund that their formula for getting Greece back on track had good odds of success. The deal will cut Greek interest rates and give the ailing nation additional time to pay back rescue loans while giving it a 34.4 billion-euro loan installment in December. As part of the agreement, Greece's debt-to-GDP ratio is expected to decline from 190 percent in 2014 to 124 percent in 2020. We hope - rather than expect - that Greece will be able to meet the terms of its new deal. Markets appeared to share our skepticism and did not show much reaction to the news. Next week will see the release of some key economic data, including November jobless claims, which we expect to come in lower as the effects of Superstorm Sandy continue to fade. Although Sandy hit in the latter days of October, the Labor department conducts its payroll survey on the 12th of each month, meaning that November data will capture the effects of the storm. We'll also be able to take a peek at the preliminary consumer sentiment report, which analysts will pore over to get a sense of what holiday retail numbers might look like. We'll keep you posted. Have a great week!Headlines• Chinese manufacturing expands in November. In a further sign that China may have turned the corner, the country's official manufacturing index rose to the highest level in seven months. Economists believe that the country may experience additional growth in December due to Christmas. • European rescue funds downgraded. Moody's Investors Service downgraded the Eurozone funds responsible for bailing out periphery nations to Aa1 from Aaa. The move was prompted by concerns about the high correlation in credit risk between the rescue funds and the countries funding them. • Investors flock to Treasuries. Despite the risks posed by the fiscal cliff, investors can't get enough U.S. Treasuries. Reversing a 6-month trend, Treasury purchases topped corporate bonds as investors piled on, seeking asset protection rather than investment growth. • Corporations rush to issue debt in 2012. Record-low rates and potential tax law changes are driving a gusher of new corporate debt. The amount of investment-grade and high yield bonds issued this year is already at a record $1.2 trillion and is likely to increase before the new year when applicable tax laws may change. Mark Ballenger is an investment and financial planning consultant offering services to individual investors and business owners. His company, Ballenger Asset Management, is located in Avon and can be reached at 970-471-9962. This report has been created with the cooperation of Platinum Advisor Marketing Strategies LLC. Securities offered through Cambridge Investment Research, a broker-dealer, member FINRA/SIPC. Ballenger is an investment adviser representative for Cambridge Investment Research Advisors Inc., a registered investment adviser. Ballenger Asset Management and Cambridge are not affiliated.