As corporations and tax experts rush to dissect the current tax bills and the unexpected decision by the Senate to leave a corporate alternative minimum tax in place, meaningful news continued to impact the markets. The headline unemployment rate stayed at 4.1% while wage growth remained mild. On the international front, the US’s decision to formally recognize Jerusalem as Israel’s capital caused waves with the United Nations and Arab allies in the Middle East, while the UK and EU were able to come to new terms on their separation. The public’s fascination with Bitcoin and cryptocurrencies reached a new level as Bitcoin experienced a parabolic and volatile rise over the last two weeks.

Amidst the noise, domestic large cap and international stocks are poised to have a banner year, with small domestic stocks lagging at a very respectable year-to-date return of 11.9%. Domestic bond prices were little changed last week as any appetite for safer assets was balanced with healthy unemployment data. While the shorter end of the curve rose substantially this year, the longer portion of the curve has fallen slightly. Therefore, US investors are not as well compensated for taking on longer maturity debt; however, foreign demand is also driving up prices and holding down yields on these longer bonds. Commodities bounced lower last week on declining metals and energy futures.