Market Update Q1 2026

The first few months of 2026 have reminded investors of something we all know, but can easily forget when headlines are noisy

Markets do not move in straight lines. After several years of strong returns, global share markets pulled back over the March quarter. The main trigger was a sharp rise in geopolitical tensions in the Middle East, which disrupted oil supplies and pushed energy prices higher. Understandably, investors became more cautious, and markets were more volatile than many had become used to.

At times like this, it is natural to feel concerned. But it is also exactly when perspective matters most.

Geopolitical events feel unsettling — but they are not new

From a New Zealand perspective, major international conflicts can make the world feel suddenly unstable. History, however, shows that periods of heightened geopolitical risk are not unusual — and they do not usually define long-term investment outcomes.

Events such as the Gulf War, the September 11 attacks, the Iraq War and the invasion of Ukraine all created understandable fear at the time. Yet global share markets have generally gone on to recover and deliver positive returns over the years that followed. Markets are forward-looking, which means they often start to recover before the news itself feels positive again.

We saw a recent example of this in early April, when talk of a ceasefire and the reopening of key shipping routes helped global share markets rebound quickly.

Is this another 1970s-style oil shock?

Some commentators have compared recent oil price rises with the oil shocks of the 1970s. While the comparison is understandable, the scale and economic backdrop are very different.

In the 1970s, oil prices rose by several hundred percent and remained high for a prolonged period, contributing to high inflation and deep market falls. This time, oil prices did rise sharply, but by a much smaller amount, and have since started to ease as ceasefire discussions progressed.

For now, this appears more like a temporary shock than the beginning of a prolonged economic crisis.

What is happening closer to home?

In New Zealand, the Reserve Bank has kept interest rates supportive to help the economy. Inflation has lifted recently, largely because of higher energy and transport costs, but the Reserve Bank appears to be looking through much of this short-term noise.

That does not mean there will be no bumps along the way. It does mean that, for households and long-term investors, the broader environment remains more supportive than the short-term headlines might suggest.

A reminder for long-term investors

Periods like this can be uncomfortable, especially for retirees, those approaching retirement, or anyone relying on their investments to support future goals. When markets move quickly, it is easy to focus on the day-to-day changes.

But in moments like these, one simple idea is especially helpful:

Zoom out, not in.

Short-term volatility can make a bad week feel like a bad year. Looking at your investments over years, rather than days or months, gives a much clearer view. Most investors have already lived through periods of far worse news and market stress — and those who stayed invested were ultimately rewarded for their patience.

The value of a well-designed plan

A well-diversified portfolio, aligned with your goals, timeframes and comfort with risk, remains one of the most reliable ways to navigate uncertain markets. Good investment plans are not built around predicting the next headline. They are built to help you keep moving toward your goals, even when unexpected events occur.

If recent market movements have raised questions for you, or if you would simply like reassurance that your plan is still on track, please get in touch with us. We are here to help you make sense of the noise and stay focused on what matters most.

Sometimes, the most valuable advice is not about doing something new. It is about having the confidence to stay the course.