1. Semiconductor stock supernova The dominant positive trend in equity markets since the recovery began in early April has been strength in AI infrastructure-related stocks. This has been influenced primarily by growing evidence that large language models (LLMs) are beginning to generate meaningful revenue and are becoming increasingly embedded within enterprise workflows. At the beginning of April, Anthropic - the company behind Claude - announced a 300% increase in annualis

There is something faintly surreal about watching markets during an inflation shock. Oil spikes overnight, freight costs surge, petrol stations reprice within days, and consumers immediately feel the squeeze in household budgets. Yet when the official inflation figures finally arrive, they often suggest calm rather than chaos. Core inflation softens. Headlines talk about “disinflation progress.” Bond markets rally on hopes that central banks may finally be nearing rate cuts.

April marked a distinct turn in the tone of markets. The rhetoric and bluster of March gave way to hopes of diplomacy as both sides stepped back from war and brinkmanship. Investors are betting that the rise in inflation and hit to growth will prove temporary, a view that remains uncertain but has been sufficient to steady sentiment for now. First-quarter earnings have, so far, stayed close to plan. With around a quarter of US large-cap companies having reported, earnings are

The last few weeks have been a rollercoaster of escalation, volatility and relief. While this may be a permanent feature of the present era, it shouldn’t be thought of purely in the context of one man. The war with Iran and the closure of the Strait of Hormuz have had a profound impact on the price of oil, inflation and the bond markets. Equity markets have shown remarkable resilience and are already near all-time highs. While peace negotiations are ongoing, the market think

1. Trump blockade and failed talks - long lasting effects The US and Iran have failed to close a deal regarding the re-opening of the Strait of Hormuz. In response, Trump has announced a naval blockade of the Strait, with an intention of intercepting vessels heading to or from Iranian ports and clearing mines laid in the waterway. By doing this, Trump has threatened to cut off Iran's oil exports and end its practice of charging ships a toll to pass, stripping Tehran of the ec

Fahad Hassan, CIO Executive summary US-Israel-Iran conflict has effectively closed the Strait of Hormuz, oil and gas prices are higher. Portfolios had already been defensively positioned — gilts exited, duration cut, UK mid-caps and European small caps removed — all of which have since fallen sharply. Macro The last month has seen a reset of inflation expectations, as the US and Israel entered a conflict with Iran. The Strait of Hormuz, a narrow body of water responsible for

Fahad Hassan, CIO The last few weeks have seen a reset of inflation expectations, as the US and Israel entered a conflict with Iran. The Strait of Hormuz, a narrow body of water responsible for 20% of the world’s seaborne oil supply, is effectively closed. Oil prices are materially higher and could go much higher still. Natural gas, a key input into fertiliser production, has seen a large jump in price, which in turn is causing an increase in food prices. Like in 2022, gove

It is impossible to second guess the next move in markets given the underlying complexity of the war in Iran. Particularly given the impact that President Trump’s comments are having on markets. What is becoming increasingly apparent is that even with a swift resolution to the conflict, the disruption from the war will result in inflated energy costs for some time.