Q2 2026 at a Glance

• Global markets shifted from optimism to caution as inflation concerns, interest-rate uncertainty and geopolitical tensions resurfaced.
• Energy price volatility became a key market driver, contributing to higher inflation expectations and a more cautious stance from central banks globally.
• Technology shares experienced increased volatility as investors reassessed AI-related valuations and capital expenditure requirements.
• Japan was among the strongest-performing developed markets, while China continued to face structural economic challenges.
• South African resource shares came under pressure as commodity prices weakened, although financials, industrials and listed property delivered positive returns.
• South African economic growth surprised positively, but rising fuel costs contributed to higher inflation and increased uncertainty around the domestic interest-rate outlook.

What this means for your investments

The investment environment remains more uncertain than it appeared at the start of the year. While long-term growth opportunities remain attractive, particularly within developed markets, diversification and valuation discipline are increasingly important. We continue to position portfolios to participate in long-term growth themes while maintaining sufficient exposure to quality businesses, bonds and defensive assets that can help navigate periods of market volatility.

At OIM we maintain a disciplined investment approach throughout the quarter, remaining focused on strategic asset allocation, valuation discipline and long-term real return generation. This disciplined process continues to underpin portfolio construction across our fund range.

Conclusion and House View Summary

As we enter the second half of 2026, our positioning continues to reflect conviction in:

• Nominal bonds (neutral duration for our local exposure)
• Developed market equities, particularly the United States
• A neutral weight to domestic equities, with selective sector positioning
• Continued use of cash to reduce volatility
• Moderated property exposure following the recent rally

Our portfolios remain anchored in diversification, valuation discipline and real return generation, ensuring alignment with long-term client objectives.

Asset allocation continues to be the primary driver of portfolio outcomes. Our quarterly Strategic Asset Allocation (SAA) review process ensures that portfolios remain aligned with the consolidated house view, informed by both macroeconomic insight and bottom-up valuation analysis.

As we enter the second half of 2026, the investment landscape remains shaped by a combination of resilient economic growth, evolving inflation dynamics and heightened geopolitical uncertainty. While periods of market volatility can be uncomfortable, they also create opportunities for disciplined, long-term investors.

At OIM, we remain committed to our proven investment process, which combines strategic asset allocation, rigorous valuation discipline and prudent risk management. Rather than attempting to predict short-term market movements, we continue to focus on building resilient portfolios designed to deliver sustainable real returns across a wide range of economic and market environments.

We would like to thank Orion Wealth Managers, its advisers and clients for their continued trust and support. We value our partnership and remain committed to helping clients achieve their long-term financial objectives through careful stewardship of capital, disciplined portfolio management and consistent investment excellence.

In an environment where market narratives can change rapidly, we believe successful investing remains rooted in patience, diversification and a long-term perspective. We look forward to continuing to partner with OWM in navigating the opportunities and challenges that lie ahead.

Adrian Meager
Managing Director & Chief Investment Officer
Orion Investment Managers