Agility Update - July 2026
Sector rotation, a high-profile IPO and geopolitical uncertainty shaped markets during the month.
Market-moving events
Rotation from tech. The Nasdaq fell by as much as 7% from its record high during the month as investors rotated into small caps, industrials, healthcare and financials. It recovered much of those losses as investors refocused on the beneficiaries of AI investment. The Magnificent 7 technology stocks underperformed as investors’ appetite for mega-cap stocks weakened.
Strong IPO debut. SpaceX shares soared 19% on their first day of trading and climbed a further 20% on the second. However, after briefly rising above US$200 (from an IPO price of US$135), the shares retraced sharply, wiping more than US$600bn from the company’s market value. Despite this, the stock finished the month up 27%, with demand remaining strong.
Fragile ceasefire. A lasting peace agreement between the US and Iran remains elusive. Although the two nations signed an interim peace agreement during the month, both launched further attacks towards month end, reigniting tensions. However, both sides subsequently agreed to a ceasefire before negotiations resumed.
Investment highlights
No portfolio changes. There were no trades conducted during June. We expect to trade and rebalance the Agility portfolios during the week commencing 6 July.
TAA adds value. Tactical Asset Allocation (TAA) was a positive driver of returns. Relative value opportunities within equity markets were the main contributor to performance. Overweight positions in US small caps and US healthcare added value as technology-concentrated large caps came under pressure. Within fixed income, long-dated US Treasuries (bonds) also contributed positively, while weakness in the Japanese yen detracted from returns.
Cautious positioning. The portfolios remain cautiously positioned. We continue to be underweight US large caps due to concerns over stretched valuations and excessive market concentration. The portfolios also maintain an overweight position in fixed income, reflecting its attractive yields and more favourable risk-return profile.
View the Asset Allocation weightings in the document below:
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