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ASX rallies as US makes ‘tremendous progress’

The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) jumped 1% higher on Tuesday amidst signs that politicians in Washington could be closer to resolving the stalemate and ending the government shutdown.

The benchmark index followed the lead set by US markets overnight, after Senate Majority Leader Harry Reid said that “tremendous progress” had been made towards reaching a deal that would avert a debt crisis and reopen the government.

Maverick Drilling and Exploration (ASX: MAD) was the top performer for the day on the news that the company had appointed J. Michael Yeager as its new CEO and Executive Chairman, which saw the company’s share price leap an incredible 15.3%.

Meanwhile, Australia’s largest miners also performed strongly as the Aussie dollar rose against the US greenback. BHP Billiton (ASX: BHP) and Fortescue Metals Group (ASX: FMG) gained 1% and 5.8%, respectively. Rio Tinto (ASX: RIO) also experienced a 2.5% boost after delivering its third-quarter production report, which revealed a record quarterly production of iron ore and a 15% increase in thermal coal output.

Each of the banks also performed strongly with ANZ (ASX: ANZ) and Westpac (ASX: WBC) leading the way with gains of 1.1% and 0.9%, respectively.

Foolish takeaway

Despite the remaining risk that the US could still enter into default, stock markets have largely recovered from their recent losses. As such, stocks are not as cheap as they were, but there are still plenty of opportunities if you know where to look!

For instance, savvy investors are now seeking growth in smaller companies. Discover two stellar small-cap opportunities now, in our brand-new research report, “2 Small-Cap Superstars” — simply click here to download your FREE copy.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.

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