Market Update: First Quarter 2026

The first quarter of 2026 was unpredictable. The developments surrounding artificial intelligence remained high on investors' agendas. At the same time, the violence in the Middle East caused a shock to the financial markets.

Looking back at the first quarter of 2026: Two sources of uncertainty.

Global stock markets started the year on a positive note. Emerging market stocks, in particular, continued their good 2025 trend. They benefited from a weaker dollar and growing interest in companies that are involved in artificial intelligence.

New AI models launched in February had varying effects: some sectors benefited while others were hit. Companies that make money with software subscriptions, also known as SaaS companies, fell in value. One common explanation is that investors fear that customers will increasingly be able to build their software themselves using AI in the future. That would make the market smaller for these companies.

Other companies actually gained value after the launches. The makers of the chips and infrastructure that run AI did well. Within the emerging markets, countries with a strong chip industry, such as Taiwan and Korea, benefited in particular. These markets were among the best performers worldwide in February. European stocks also held up well. The European market has fewer software and tech companies than the American one, and was therefore less affected by the decline in value among software companies.

European government and corporate bonds performed calmly and stably in these first months, helped by slightly falling interest rates.

At the end of February, the sentiment changed. The escalation in the Middle East and the subsequent disruption of shipping through the Strait of Hormuz caused market turmoil. The Strait of Hormuz is an important oil transit route, affecting a large part of the global energy supply. Investors lowered their risk and sold stocks. Emerging markets in East and Southeast Asia were particularly affected because many of these countries import a significant part of their oil via this route. On balance, emerging markets still remain positive throughout the quarter, thanks to their strong start.

The fear of higher inflation due to more expensive energy also changed the picture for bonds. Higher inflation can lead to higher interest rates, which decreases the value of existing bonds. The positive start of European government and corporate bonds therefore turned into a slightly negative result for the quarter. Global high yield bonds held up better. They usually have a shorter duration and a higher interest rate, making them less sensitive to a rise in market interest rates.

A weaker quarter: what does this mean for your portfolio?

The quarter started moderately positive, but ended in the red for several categories, while others closed slightly positive. Stocks of large developed market companies had the worst results. In most plans at Vive, this is the largest asset category in the portfolio. Is this a reason to adjust your investments?

Our advice: stick to your strategy

A weaker quarter is not in itself a reason to change anything. If your risk appetite has really changed, for example due to a change in your personal situation, please let us know. If not, sticking to your strategy calmly is almost always the wisest choice.

Stay focused on your long-term goal

One quarter says little about how your wealth will develop in ten, twenty or thirty years. Fluctuations are part of investing, just like periods of world turmoil are part of a long investor horizon. What matters in the long run is that your investment continues, your risk fits your situation and you don't let the issues of the day take you off course.