The possibility of there not being militatary action against Iraq is very positive for the markets and the economy.
The adverse affect any military action especially if the action was prolonged would have been great especialy to oil prices - increased oil price have the same effect on economic growth as do increased interest rates.
Yes there are a large number of other problems that need to be resolved before economies around the world get back on track - but the markets will take the view that potentialy at least this is one problem out of the way.
