MARKETS IN A NUTSHELL — FOR FEBRUARY 2026

February ended in dramatic fashion as the United States and Israel launched air strikes on Iran. Iran’s supreme leader, Ayatollah Khamenei, was reported killed. Tehran described the attack as ‘criminal’ and vowed retaliation, which is underway. Iran’s reprisal threatens regional contagion. As March begins, investors are focused on the consequences of the war on energy prices, inflation expectations and risk premia.

The most immediate channel is oil and gas. Shipping through the Strait of Hormuz slowed sharply after the strikes. Qatar halted liquified natural gas (LNG) production following attacks on its facilities, removing close to a fifth of global LNG supply. Brent crude quickly rose by double digits past $80 a barrel. Europe’s gas benchmark surged by nearly 50 percent, its largest daily move in years. For Europe and parts of Asia still adjusting to the post-Russia energy landscape, energy supply security will again take centre stage.

Energy producers and gold advanced, while travel and leisure shares retreated. Broader equity indices traded weaker off high bases, but did not capitulate. In the US, share markets ended February close to where they started the year — near all-time highs. The dollar softened as investors weighed geopolitical risk alongside renewed uncertainty around US trade policy. After the US Supreme Court constrained the Trump administration’s tariff regime, a proposed 15 percent global levy was deferred in favour of a lower interim rate, with further measures still under consideration.

The market continues to reassess which business models stand to gain from the AI trade, and which may face pressure. Software shares fell heavily after Anthropic unveiled its latest ‘vibecoding’ agent, while hardware suppliers and selected ‘heavy asset’ businesses proved more resilient. Credit markets started to show signs of strain. The US labour market shed more jobs in January than it had in any January since 2009 on corporate layoffs and investment in AI bots. 

Investors continue to rotate into other geographies: UK, European and broader emerging share markets all outperformed the US last month. Chinese share markets were down on continued profit taking. In South Africa, the JSE and bond markets surged again as the commodity rally continued.

The Foord funds had mixed results. The Foord International Fund was again up meaningfully, taking the one-year return to 40 percent in US dollars. The global equity funds were lower after Chinese shares retraced this month. The South African suite benefitted from the SA bull market in shares and bonds, with rand strength paring returns in the multi-asset funds.

Geopolitical crises seldom offer clarity in their early stages. Looking ahead, the big unknown is what happens to inflation. The US Federal Reserve was already signalling caution on the path of inflation before the energy price spike. Energy shocks rarely stay confined to oil markets, and supply disruption raises the probability of higher price pressure globally as well as in South Africa. The Foord multi-asset portfolios continue to guard against the inflation risk, with meaningful exposure to inflation-linked bonds and to gold as a geopolitical hedge.