05.02.26

February 2026 Investment Summary

January delivered positive equity returns against an unusually charged political backdrop, underscoring once again the market’s capacity to look through near term noise. From escalating geopolitical tensions and unconventional policy signals out of Washington to rapid shifts within key investment themes, the start of 2026 has been anything but calm. Yet beneath the headlines, familiar structural drivers such as defence spending, artificial intelligence and resource demand continued to shape outcomes, while monetary policy expectations evolved in unexpected ways. In this month’s update, our Chief Investment Officer, Jeff Brummette, reflects on how markets navigated these crosscurrents and what they may imply for portfolios as volatility becomes a more persistent feature of the year ahead.

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Equity markets were broadly positive over the month, despite President Trump’s best efforts to destabilise the geopolitical landscape.

 

Equity Markets

Index returns are in local currency terms except where noted

Source: Bloomberg

 

Fixed Income Markets

Source: Bloomberg

 

Alternative Investments Markets

Commodity returns are versus the U.S. dollar

Source: Bloomberg

 

Currency Rates

Exchange rate changes are versus the U.S. dollar 

Source: Bloomberg

The month began with the abduction of Venezuelan President Nicolas Maduro and his wife by the U.S. military, after which they were transported to New York to face charges related to alleged involvement in illegal drug trafficking. No new leadership was installed in Venezuela, with President Trump instead suggesting he would oversee the country directly. In addition, the U.S. Navy has been seizing sanctioned tankers entering or leaving Venezuelan waters, while additional pressure was place on U.S. oil companies to invest in Venezuela.

This was quickly followed by President Trump’s speech in Davos, Switzerland, where he called for Denmark to transfer control of Greenland to the United States. He criticised NATO as offering limited value to the U.S., though he acknowledged he would not use military force to seize Greenland. He also threatened punitive tariffs on Europe, Canada and South Korea for their refusal to assist with Greenland, their deepening ties with China, and delays in ratifying the previously agreed trade deal.

Domestically, the administration continued directing the Department of Homeland Security to pursue its immigration objectives aggressively, with reports circulating of a daily quota of 3,000 individuals. The tactics by Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP) forces have drawn significant criticism, particularly after the deaths of two U.S. citizens in Minneapolis, Minnesota, involving federal agents. Public reaction across the country has been strongly negative, and President Trump’s approval ratings, including among Republicans, have declined. Although he had previously been successful in restricting crossings at the Mexican border, this issue has now come to dominate domestic discourse and is overshadowing his broader economic messaging

The investment trends that dominated 2025 have continued into the new year. European defence stocks and the defence sector more broadly, have had a strong start to the year, supported by renewed urgency around military spending after President Trump’s comments on NATO and Greenland underscored the need for Europe to materially strengthen its defence capabilities.

AI-related capex expenditure and sustained enthusiasm over the future of AI adoption remain key drivers of equity returns, though dispersion amongst the participants in this field is widening. Nvidia, the standout performer in this sector for several years, has been broadly flat over the past six months, while a variety of other companies have had very strong performance. Samsung stands out as a chip maker who may provide an alternative (or maybe just a complement) to Nvidia’s product suite. At the same time, investor sentiment has cooled towards Microsoft’s AI offering, with growing optimism instead directed at Alphabet’s and Meta’s AI products.

 

Selected AI-related Stocks January 2026

Source: Bloomberg

However, this is an extremely fast moving and volatile space, and it is far from clear who the champion (or champions) may be. As a result, we continue to maintain a highly diversified approach to our exposure within the sector.

Linked to AI is the ever-growing demand for electricity. The need to upgrade electric power grids around the world has led to a surge in copper and silver prices, along with several other metals. Gold has also extended its strong run. Despite a significant correction on the final trading day of the month, these metals all posted strong gains, which in turn supported the mining sector. Even after the end of the month pullback, the broad mining ETF was up over 14% for the period.

 

Van Eck S&P Global Mining UCITS ETF

Source: Bloomberg Finance L.P.

 

We anticipate further gains in both this sector and in precious metals.

On the final trading day of January, President Trump announced Kevin Warsh as his nominee for the next Chair of the Federal Reserve Board. Markets have, mistakenly in our opinion, interpreted him as a “hawkish” appointment. President Trump has been vocal in his desire for lower interest rates, and Kevin Warsh has been campaigning for this job for the past year. It is no coincidence that he is a long-time friend of Treasury Secretary Scott Bessent. Under his leadership, we do not expect the Federal Reserve to adopt a hawkish stance.

So far, financial markets have not only absorbed but benefited from the volatility created by President Trump’s rhetoric and policy announcements. However, this resilience may not be sustained throughout the year. As we approach the November mid-term elections, which could be a significant risk for the administration, we should expect the potential for greater market volatility.

Oakglen will keep you updated on any significant developments in our continued commitment to providing investment insights to our clients, advisers and partners.

 

The price and value of investments and any income that might accrue may fall as well as rise and is not guaranteed. You may not get back the amount of your original investment.

 

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Hear more from the Oakglen experts

Our investment team continue to provide interesting and informative content to help keep you in the loop on recent global news and market trends. See below for some key highlights from around the world which our Chief Investment Officer, Jeff Brummette, has also recently covered:

 

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    Jeff Brummette
    Chief Investment Officer
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