Stocks keep rising on hopes for budget deal Updated at 4:46 p.m. NEW YORK The stock market gained ground on Friday, a sign investors are hopeful that political leaders in Washington will soon hammer out a deal to end the partial government shutdown and avert a possible U.S. debt default. The Dow Jones industrial average rose 111 points, or 0.7 percent, to close at 15,237. The index surged 323 points yesterday as House Republicans offered a proposal to extend the government's borrowing authority for six weeks. The Standard & Poor's 500 and Nasdaq composite were also up slightly. "To this point, capital markets have taken the news in stride, a reaction that is consistent with prior shutdowns," said Jim Baird, Chief Investment Officer for Plante Moran Financial Advisors, in a note to clients. Yesterday, markets rallied sharply on hints that a thaw between the parties was underway and more productive discussions may be forthcoming. President Obama, Republicans in Congress starting to work together Stocks have sagged in recent weeks as an Oct. 17 deadline to raise the debt ceiling approached and as the shutdown eroded consumer confidence. Market watchers say that a failure in Congress to clinch a deal to boost the borrowing cap and reopen federal agencies would cause stocks to plunge and damage the broader economy. "I'm still expecting a mini-correction this month in reaction to Washington's latest fiscal fiasco, followed by a good year-end rally that continues into next year in reaction to its resolution," said Ed Yardeni, president and chief investment strategist for institutional investor advisory Yardeni Research, in a research note. If it isn't resolved quickly, there could be more downside, possibly as wicked as the free-fall during the summer of 2011 caused by the fiscal fiasco back then. Other analysts are concerned that a short-term increase in the debt ceiling would prolong fiscal uncertainty and weigh on consumer sentiment, which could dampen sales during the crucial holiday shopping season. Senate Republicans trooped to the White House Friday morning for discussions with President Barack Obama on ending the stalemate.