Global markets digested a volatile mix of trade policy headlines, geopolitics and ongoing sector rotation in what was an overall positive week for equity markets. US equities finished the week higher despite a backdrop of softer economic growth and persistent inflation, as data showed the latest quarterly GDP numbers slowed – partly due to the prolonged government shutdown – and inflation measures came in above expectations, slightly reducing market pricing for near-term Federal Reserve rate cuts.1
After initially responding favourably to news that a court ruled parts of Trump’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs as illegal, which briefly boosted equities, bond yields and the US dollar, sentiment softened again after the announcement of fresh 15% tariffs over the weekend, reintroducing trade risk as a continuing theme from last year.
Commodities were a notable source of strength. Silver (ETPMAG) soared 9% last week, boosted by news that Trump’s tariffs were ruled illegal, with gains flowing through to silver miners (SLVM), which outperformed broader equities. Gold (GOLD, GXLD, GHLD) also climbed, recovering some earlier losses, reinforcing its role as a defensive hedge amid macro and geopolitical uncertainty.
Energy markets were also in focus as oil prices rallied on heightened geopolitical risk. Brent crude oil climbed to a six‑month high, with prices up around ~6% last week as traders priced in the possibility of a US‑Iran confrontation and potential supply disruptions, particularly given the strategic importance of the Strait of Hormuz for global flows.2 The move underscored how sensitive energy markets remain to Middle East tensions, even as diplomatic channels stay active and broader fundamentals remain mixed.
Defence stocks (DTEC, ARMR, DFND) performed strongly as rising geopolitical tensions and increased defence spending expectations continued to support the sector. In contrast, cloud computing (CLDD) and cybersecurity names (BUGG, HACK) extended their recent weakness, as investors rotated away from software businesses amid ongoing concerns around AI disruption.
Asia once again outperformed, led by South Korea (IKO), which continued its strong run, reaching another all-time high and is now up around 35% so far in 2026.3 Semiconductor (SEMI) and hardware exporters remained key beneficiaries of improving memory pricing and sustained AI-related demand, reinforcing Korea’s position as one of the standout equity markets globally this year. At the same time, global investors are increasingly rotating into Europe (ESTX, IEU, VEQ, HEUR), with record inflows into European equities as portfolios diversify away from an expensive, tech-heavy US market toward cheaper valuations, non-tech sectors and improving growth momentum across the region.4
Digital assets were weaker, with crypto markets continuing to struggle last week as risk‑off sentiment dominated. Bitcoin has now fallen close to 50% from its peak, entering one of its deepest selloffs in years, with traditional dip buyers largely absent and broader market stress pressuring prices.5
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