A strong week helped keep the S&P 500’s monthly winning streak alive, although the red-hot NASDAQ had the first negative down month in recent memory. The devastation of Harvey and more provocations by North Korea were overlooked by investors in favor of strong GDP growth, potential tax reform, a friendly jobs report and views that central banks will remain accommodative.
Weekly Returns:
S&P 500: 2,477 (+1.4%)
FTSE All-World ex-US: (+0.5%)
US 10 Year Treasury Yield: 2.16% (-0.01%)
Gold: $1,325 (+2.6%)
EUR/USD: $1.186 (-0.4%)
Major Events:
Our Takeaway:
The Trump administration promised more detail on planned tax reform in the coming weeks. So far it has been big on promises but light on details. Statements to the public have focused on potential tax reductions for the middle class, but the biggest impact could be on corporate rates, which Trump wants to lower. It is debatable if this is good for the country, but it probably would be good for owners of stocks. We think the likelihood of passage of some kind of tax bill is high but far from certain. Many on the GOP side are desperate to show some kind of success.
