Quarterly Market Update - June 2026

Market Update - June 2026

Despite ongoing geopolitical tensions and volatility in energy markets during the quarter, investment markets delivered strong returns across most major asset classes. International share markets performed particularly well, supported by resilient company earnings, continued investment in technology and AI-related industries, and improving investor confidence as concerns surrounding the Middle East conflict eased temporarily. Yet again we are shown that equity markets can still grow in times of economic stress.

Closer to home, it feels as though New Zealand's economic recovery is being restrained by the lingering effects of higher oil prices and the recent conflict in Iran. This is despite the strong performance of our agricultural sector, which continues to provide meaningful support to the domestic economy.
We have also seen interest rates move higher recently, while a number of political narratives have emerged highlighting perceived weaknesses in New Zealand's economic position. It is important to view these issues in their proper context.

Firstly, although interest rates have increased, they remain at levels that would generally be considered stimulatory and are still well below long-term historical averages. Secondly, as we move closer to an election, it is worth considering the motivations behind some of the commentary and headlines that gain attention.

A good example is the narrative surrounding the number of people leaving New Zealand. We recently examined this issue and found that when emigration is measured as a percentage of the total population, the current rate is broadly in line with long-term historical averages. The exception, of course, is the Covid period, which produced unusually distorted migration data because of border restrictions and other extraordinary circumstances. The key takeaway is to remain cautious when interpreting economic and political rhetoric over the coming months. Headlines are often designed to attract attention rather than provide perspective. Maintaining a healthy degree of scepticism and focusing on the underlying data will be increasingly important as the election cycle gathers momentum.

While market conditions can change quickly, the past quarter once again highlighted the importance of maintaining a long-term investment perspective and staying focused on your personal goals rather than short-term headlines. As always, our investment philosophy remains centred on diversification, disciplined portfolio management, and helping you remain on course through both favourable and challenging market environments. Please check out our market update video for insights into where we think markets may go from here and how you should be considering your own strategy.