Markets ended last week a bit on edge as Israel and Iran exchanged missile attacks. It quickly became clear this was an escalation, however worst-case scenarios were avoided for the time being. This coupled with some better than feared economic data in China helped global markets move modestly higher to start the week. Outside of the Middle East the big catalyst this week was the FOMC rate decision. The overarching message from Fed Chair Powell was consistent with the recent communication - the economy continues to remain resilient, and as long as that is the case, he is comfortable with the current monetary policy stance. US indices ended the week mixed with some modest outperformance by small and mid-cap indices. Once again all eyes will be on the Middle East this weekend. The key economic data next week will be the Global flash PMIs on Monday and the PCE. Powell will be testifying before Congress on Tuesday and Wednesday. Next Friday is also the Russell Reconstitution so expect another big closing auction.

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