Like the month of July, last week was eventful and volatile, anything but your typical summer doldrums. After President Trump paused strikes over the weekend oil prices fell sharply. However, kinetic activity resumed during the week after Iran broke the piece. President Trump repeatedly threatened to “hit ‘em hard” as if it was the chorus of a new pop song. Outside of geopolitics investors had plenty to digest - we entered the peak of earnings season, there were key central bank rate decisions, currency intervention and the continued momentum/tech wreck. That "situation" hit a tipping point on Thursday with the forced liquidation of levered positions at the supernova hedge fund Situational Awareness. Traders saw this as a clearing event which along with strong mega-cap tech earnings helped tech stocks snap back in the back half of the week. That rally left the S&P 500 essentially unchanged in the month of July, which as we’ve highlighted throughout the last few weeks did no justice to the volatility under the surface.

The month of August started on a much more positive note. Coming out of the weekend it felt like Ground Hog’s Day as President Trump once again put a hold on strikes as he suggested that there had been some progress in negotiations behind the scenes which could potentially lead to a diplomatic resolution. Early in the week press reports and comments from other administration officials suggesting that a deal to re-open the Strait was close sent ICE Brent back below $80 and helped Treasury yields pullback after hitting new YTD highs last week.