North Korea ICBM Tests — July-September 2017
Nuclear-capable missiles, 'fire and fury,' and a market that shrugged
North Korea tested two ICBMs, launched a missile over Japan, and detonated a thermonuclear device. Trump responded with 'fire and fury.' The S&P 500 pulled back roughly 3% in mid-August then recovered within weeks. The S&P 500 finished 2017 up over 19%.
What history says
Editorial commentary written by ALAN analysts. Figures cited below are analyst-authored context — they are not derived from the chart above and may reflect different windows or sources.
The VIX barely budged above 16. Options markets never signaled meaningful tail risk.
S&P 500 earnings grew roughly 12% year-over-year in 2017, with tax-reform approaching.
Headlines read 'nuclear war possible.' The S&P 500 returned over 19% in 2017.
Check what the options market believes before acting on apocalyptic headlines — through repeated missile tests the VIX barely stirred, and accelerating earnings carried the index to a strong year. When measured risk pricing and the news cycle diverge that widely, the portfolio case has usually sided with the earnings.