In this update, Keith Balmer, Portfolio Manager provides an update on how conflict in the Middle East has impacted markets, discusses how potential scenarios could play out and explains how the team are monitoring the situation.*
*Filmed on 11 March 2026.
At a glance
- Markets are volatile and in risk-off mode. Downward moves are broadly in line with expectations and news flow is driving moves. The closure of the Strait of Hormuz to shipping has pushed oil prices higher which in turn threatens higher inflation. Interest rate expectations are being adjusted accordingly.
- The full impact on economies and markets will be determined by the duration of the conflict. Our base case remains anchored around short-lived hostilities and as and when energy prices ease there will be scope for adding risk to portfolios. We remain cognisant of uncertainty however and are mindful that a prolonged conflict could trigger further weakness. Should that play out, a more cautious stance would be prudent.
- For now, the team are adopting a wait and see approach with little change to how the portfolios are positioned. That means a modest pro risk stance on the basis that underlying fundamentals – both corporate and economic – remain sound.
