Tariffs, Tehran and Turbulence

Key market movements

 

• Global equities navigated a multi-faceted landscape, delivering solid   returns over the month. The MSCI ACWI rose 2.1% in NZD terms and 1.4% for NZD‑hedged investors, with markets continuing to rotate away from mega-cap US technology names.
• New Zealand and Australian equities also performed well. The S&P/NZX 50 gained 2.3%, supported by an encouraging domestic earnings season, while Australian shares advanced 4.1% in AUD and 6.9% in NZD terms.
• Bond returns were positive over the month, as investors sought high quality assets amid growing geopolitical uncertainty. Global bonds (NZD-hedged) rose 1.3% as government bond yields trended lower, while the Bloomberg NZ Bond Composite gained 1.5%, helped by dovish commentary from the RBNZ's February meeting.

Key developments

Global equities navigated a turbulent February, with AI-related anxiety weighing on sentiment across software stocks and asset managers with exposure to the sector.

While major indices held up reasonably well, individual stocks experienced sharp moves as investors paused to assess the disruptive potential of rapidly advancing AI across industries including real estate, trucking, and wealth management.