Market Digest \u2013 Week Ending 2\/8\r\n\r\nThe streak stayed alive, but barely. US stocks gained for a sixth straight week, but renewed political concerns in Spain and Italy limited gains in the S&P 500 to 0.3%. International markets as a whole\u00a0declined. In Spain, Premier Mariano Rajoy is facing scrutiny about alleged illegal payments, while in Italy Silvio Berlusconi narrowed his deficit in the polls. Both events peaked on Monday, but bond yields of each country stabilized, suggesting the next round of the European debt crisis is unlikely to ignite now. Treasuries also gained, with the dollar looking more attractive after the Euro\u2019s recent rally.\r\n\r\nWeekly Returns:\r\n\r\nS&P 500: 1,518 (+0.3%)\r\n\r\nMSCI ACWI ex-US: (-1.5%)\r\n\r\nUS 10 Year Treasury Yield: 1.95% (-0.08%)\r\n\r\nGold: $1,669 (+0.1%)\r\n\r\nUSD\/EUR: $1.336 (-2.1%)\r\n\r\nMajor Events:\r\n\r\n \tMonday \u2013 The Justice Department sued Standard & Poor's Ratings Services, alleging the firm ignored its own standards to rate mortgage bonds that imploded in the financial crisis.\r\n \tTuesday \u2013 Obama urged Congress to pass a smaller version of spending cuts and tax increases and to delay a larger package slated for next month.\r\n \tTuesday \u2013 Dell approved a $24 billion deal to take itself private.\r\n \tWednesday \u2013 The US Postal service announced it would end Saturday delivery.\r\n \tThursday \u2013 ECB President Draghi said the stronger Euro has dampened inflation risks, possibly opening the door for more stimulus.\r\n \tThursday \u2013 LinkedIn announced sharply higher revenues and profits and said it passed 200 million users. Shares rose over 20%.\r\n \tFriday \u2013 EU leaders reached a deal on the budget for the next 7 years, which is separate from individual country budgets. It includes a ceiling for new spending commitments.\r\n\r\nOur Take: \r\n\r\nDell\u2019s move to take itself private falls just short of making the 10 largest private equity buyouts of all time. But it may be remembered as an important one if it triggers an increase in merger and buyout activity. With corporate debt yields near all-time lows and equity valuations moderate, we have been surprised more deals have not occurred.\r\n\r\nStock valuations have been creeping up with the market. The forward PE on the S&P 500 is now 13.6, according to the Wall Street Journal. This is lower than the historical average of the last few decades, but is meaningfully higher than it was a year ago. For stocks to advance significantly from here, it will require earnings growth and multiple expansion. Rightly or not, private equity is often seen as the smart money. More deals would help the market feel more comfortable with higher valuations.