Despite a still-shuttered Strait of Hormuz causing a snare in global commodity trade, equity markets staged an impressive rebound in April.
The nations at war are technically bound by a ceasefire at the time of writing. But that agreement is fragile at best; progressing toward peace and backsliding into open conflict seem to trade headlines daily. The sudden shifts have led to intense volatility as investors recalibrate to the latest developments.
The ongoing crisis has shown that optimism is a more eager emotion than pessimism. Markets have been quick to rebound with any hint of de-escalation, and overall, the pullbacks have been less severe than historical precedents.
Perhaps it’s conviction, or perhaps it’s overly dismissive of risk—in either case, consumer spending has shown resilience so far. Fiscal support from North American governments has certainly helped, yet that buoy becomes progressively more difficult to maintain as time goes on. Government ledgers are stretched as they are.
The most immediate consequence of spiking oil prices is a drag on household spending. The next step would be companies passing along higher fuel-related costs to consumers. Third-order effects would be the decoupling of supply chains as commodities become stuck in transit. Each stage can contribute to a feedback loop of sorts.
Whether the event is disruptive or destructive is a function of time—the longer it persists, the wider the ripples. Central banks would typically forgive isolated energy pressures when making interest rate decisions, but the question is now one of transmission: how might temporary factors devolve into lasting inflation?
Our penchant for diversification has proved its worth throughout sustained turbulence. We protected client capital during the more severe drawdowns and participated in the subsequent recoveries. There is ultimately no way to know when or how this episode ends, and our double priority of defend & deliver reflects that understanding. A lasting resolution should propel markets higher; an extended conflict could pull them lower.
Market Minutes, May 2026
Despite a still-shuttered Strait of Hormuz causing a snare in global commodity trade, equity markets staged an impressive rebound in April.
The nations at war are technically bound by a ceasefire at the time of writing. But that agreement is fragile at best; progressing toward peace and backsliding into open conflict seem to trade headlines daily. The sudden shifts have led to intense volatility as investors recalibrate to the latest developments.
The ongoing crisis has shown that optimism is a more eager emotion than pessimism. Markets have been quick to rebound with any hint of de-escalation, and overall, the pullbacks have been less severe than historical precedents.
Perhaps it’s conviction, or perhaps it’s overly dismissive of risk—in either case, consumer spending has shown resilience so far. Fiscal support from North American governments has certainly helped, yet that buoy becomes progressively more difficult to maintain as time goes on. Government ledgers are stretched as they are.
The most immediate consequence of spiking oil prices is a drag on household spending. The next step would be companies passing along higher fuel-related costs to consumers. Third-order effects would be the decoupling of supply chains as commodities become stuck in transit. Each stage can contribute to a feedback loop of sorts.
Whether the event is disruptive or destructive is a function of time—the longer it persists, the wider the ripples. Central banks would typically forgive isolated energy pressures when making interest rate decisions, but the question is now one of transmission: how might temporary factors devolve into lasting inflation?
Our penchant for diversification has proved its worth throughout sustained turbulence. We protected client capital during the more severe drawdowns and participated in the subsequent recoveries. There is ultimately no way to know when or how this episode ends, and our double priority of defend & deliver reflects that understanding. A lasting resolution should propel markets higher; an extended conflict could pull them lower.