A wave of relief hit the markets this week as Hurricane Irma’s impact on the US was far less than anticipated. This combined with a delay in additional aggression from North Korea kicked off a strong start to the week. While another North Korean test launch occurred prior to Friday’s open, the markets did not react strongly. Equifax continued to deal with the aftermath of the massive data breach that impacted the majority of adults in the US. Given that Equifax is charged with protecting consumers from identify theft and its seemingly subpar response to the crisis, consumer watchdogs and legislators and likely to press for penalties and preventative measures.
Stocks rebounded with the S&P 500 hitting a new high above the 2500 mark. Bonds retreated on the better news from Florida as well as new consumer inflation numbers that neared the 2% target from the Fed. The rise in the CPI was mostly from increases in energy. However, there was limited impact from Hurricane Harvey in the August data leading expectations that the September inflation number will be even higher. Given that the Fed is closely watching inflation to determine whether another rate rise in December is necessary, bond prices reflected this news with the Aggregate Bond Index backing off 0.5%. Commodity funds picked up some positive returns with the higher energy prices.