The S&P 500 Index of the 500 highest-cap U.S. publicly quoted companies hit a new all-time high yesterday, and is still rising this morning in off-session trading. While U.S. stocks have been making new record highs for some time, the American market was joined by the Japanese, as the benchmark Nikkei 225 Index hit its highest level in over twenty-five years. Analysts are tending to attribute the continuation of a firm bull market to broad, underlying macro factors, rather than any specific policy initiatives floated by Congress or the White House, although the prospect of dramatic cuts in U.S. Federal and Corporate taxes is probably providing some tailwind to aid the rise.

Crude Oil is rising to trade at levels not seen in over two years, with WTI selling at over $57 per barrel. The bullish breakout above the $55 area is seen driven by a confluence of events in Saudi Arabia, a major oil producer. The past few days have seen an unprecedented wave of arrests of elite figures, including members of the royal family, on anti-corruption charges, as well as a ballistic missile attack on Riyadh by an Iranian proxy, and the resignation of the Lebanese Prime Minister while on Saudi soil. The common thread behind the story seems to be the emergence of the new Crown prince strongly pursuing an agenda of modernization and an increased willingness to confront Iran, whether in Yemen, the Gulf, or Lebanon. One of the most high-profile arrests has been of a senior Saudi prince with ties to the Clintons who is a major investor in some high-profile American companies. The overall effect has been to raise the risk premium on Saudi investment for foreign investors, but the higher price of oil will certainly be the outcome having the greatest global impact.