Stocks briefly posted new highs this week and a unifying solution for health care reform remained elusive. The potential for passing a Senate health care bill was further hindered by Senator McCain’s brain cancer diagnosis. The expanding investigation of President Trump’s ties to Russia remains a distraction as Congress moves to focus on tax reform in the weeks to come. Overseas, the expectation that the ECB will reduce its stimulus outweighed Draghi’s softer tone, driving the euro higher last week. The U.S. and China trade talks were reported to be tense and while each side agreed to a “shared objective” no specific outcomes were achieved.

Equity markets rose this week reaching new highs for the S&P 500 and Nasdaq, but then retreated slightly to end the week with a solid increase. International stocks finished the week in the black, but dropped on Friday as a stronger euro caused fears of lower exports and a drag on European growth. U.S. bond yields fell back this week as there was limited evidence to counter the weaker inflation and economic growth data; lowering the potential for another rate hike by the Fed this year. With the lower yields, bond prices increased and bond funds had a strong week with the Bloomberg Barclays US Aggregate Index up 0.5%. Managed futures fell and replaced commodities for the lowest returning spot on a one-year basis.