Equity markets and bond markets for June overall in New Zealand dollars were again positive, culminating in double digit gains for equities in Q2 2026 and positive returns for bonds. The quarter was the best performing equity quarter since Q2 2020, where we experienced a sharp recovery after Covid. Returns for the portfolios were boosted by the strength of the US dollar, which meant when converted back to NZ, all the equity returns in the portfolios were positive. The US dollar strength added 5% to US assets when converted back to NZ dollars. 

2026 to date has produced double digit performance for global equity markets, rewarding those that maintained their investments in the more aggressive100/0, 80/20 and 60/40 profiles, ignoring the noise around Middle East conflict, fears of inflation rising, Donald Trump, and pending elections. 

If we dig deeper, equity markets were volatile during the month, with investors concerned about the sustainability of the AI trade and inflation fears. Gains were skewed. Some markets were up (Europe, Japan, NZ, Australia, US small caps +7%), some were down (US top 50 –4.6%, Asia –1.5%), some sectors were up (European IT +9%, Japan IT +14%, Europe & Japan Financials +5.6%) and some were down (Energy and Communication services were down 7% each, US IT –3%). 

AI remained the dominant market theme, but we saw a change within it. Where earlier in the quarter we saw gains concentrated in US hyperscalers and platform companies, in June this shifted toward semi-conductor manufacturers, memory producers, power infrastructure, and data-centre supply chains. This had its biggest positive impact in Taiwan and South Korea. 

Bond yields were largely unchanged in June and the quarter. New Zealand bond delivered better returns than their global counterparts, close to 3% for Q2 versus 1%. Global bond markets moved from expecting a smooth easing cycle to pricing a higher probability that central banks would need to pause or even tighten again (raise interest rates). Longer-dated yields remained elevated as investors demanded compensation for inflation risk, fiscal deficits and policy uncertainty. 

Looking at other asset classes, we saw some large declines in value. Commodities retreated around 10%, with Crude Oil down 17% in June, 20% for Q2, and Gold down 12% in June and 14% for Q2. Digital assets (eg cryptocurrencies, blockchains) remained under pressure, down 17% for June and 33% for the year to date. 

To reiterate the SBS Wealth Portfolio Service does NOT hold digital assets, gold or commodities directly.  

The other big news in June was the initial public offering (IPO) of SpaceX, a rocket and spacecraft manufacturer, founded by Elon Musk back in 2002. The IPO valued SpaceX at almost USD1.8 trillion, making it the largest public offering over. We did not participate in this offer, believing the valuation to be extravagantly high and preferring to wait until further information about the company is made public. In saying that, we do get some exposure through companies like Alphabet and Nvidia, who are SpaceX shareholders. 

The positive returns from both the equity markets and the bond markets filtered through to positive returns for all the Private Wealth risk profiles, with those with more growth assets performing better than the more conservative ones. 

Within the underlying funds, hedged global equity funds performance was close to 0% while the unhedged global equity funds performance were closer to 5% return. Top performing funds for June from the Approved Product List were the thematics HEAL 12.5%, RBOT 10.7%, and Munro GCLF 7.4%, the iShares MSCI World SRI ETF 9%, and DFA Australian Sustainability PIE 3.1%. Within the directs, globally returns were extremely diverse, ranging from 43.4% (Micron) to –30% (Accenture). Transtasman, we also had massive volatility also, from 39.7% (A2Milk) to –13% (Fortesque).