07 Jul 2025-26 saw lots of noise but strong returns (again) – can it continue?
Key Points:
- While we saw a long list of worries over the last year, 2025-26 saw another financial year of strong returns.
- Risks around Iran and oil, various other geopolitical issues, sticky inflation and possible further rate hikes and AI related bubble worries could drive another correction in shares.
- In Australia, the main risks relate to sticky inflation, RBA rate hikes and the property downturn.
- However, with recession looking unlikely, profits likely to keep rising and the Fed and RBA likely to be cutting rates in 2027, investment returns are likely to be reasonable over the year ahead but maybe a bit slower than those of the last four years.
- The key for investors including super fund members is to maintain a long-term strategy and turn down the noise.