Financial outlook brightened in April

Since the outbreak of the Iran conflict in late February, geopolitical tensions have dominated financial markets. Bond and equity markets declined in tandem as energy prices surged, and even gold – traditionally seen as a safe haven during times of geopolitical unrest – offered little protection. Fortunately, the situation has evolved significantly since then.  

By early April, markets had rapidly recovered more than the losses recorded in March, with global equities reaching new all-time highs. This rebound is notable given that many of the underlying economic challenges linked to the conflict remain unresolved: The Strait of Hormuz, through which around 20 per cent of the world’s oil supply would normally pass each day, remains blocked, and there have been no clear breakthroughs in peace negotiations. On the contrary, threats of further attacks continue to be exchanged on a daily basis. 

What has driven the market recovery?

So what has fuelled the rebound in equity markets? 

In my view, financial markets have largely moved past the conflict. One clear indicator is energy stocks, which were among the preferred ‘safe havens’ during the market turmoil in March but have since fallen back to levels seen before the escalation. 

Instead, other segments of the equity market have taken the lead. In particular, the major US technology companies – often referred to as the 'Magnificent Seven’ – have been at the forefront of the market’s comeback. Perhaps because these companies prove, quarter after quarter, that behind their high valuations are bobust business models and strong earnings capacity. It may also suggest that investors have reassessed the sharp price declines seen in these stocks during January and February, which in hindsight may have been excessive. 

Looking ahead, I expect a broader range of equities to contribute to returns as the year progresses. This outlook is underpinned by a generally positive view of economic prospects, which so far appear resilient despite the sharp rise in energy prices. Provided that hostilities subside within a foreseeable timeframe and energy transportation gradually normalises, the global economy should remain on a solid footing and inflation stay under control. Ultimately, much will depend on whether Donald Trump and Iran succeed in de-escalating tensions. 

Velliv leading the market – and April looks particularly strong 

At Velliv, we have responded swiftly since the outbreak of the conflict to ensure that our customers’ pension savings are managed as effectively as possible through volatile market conditions. 

A typical Velliv customer with a medium-risk profile and 15 years until retirement has, so far in 2026, recorded a return of between -2.0 per cent and -2.3 per cent up to the end of March. Compared with the rest of the industry, this places our performance at the top. While negative returns are never welcome, we’re encouraged by the strong turnaround seen in financial markets during April. 

I therefore remain positive about the outlook for pension returns when we sum up 2026 as a whole. The sharp declines in March – followed by equally strong recoveries – serve as an important reminder of the need to take a long-term perspective on pension savings. Market fluctuations are a natural and unavoidable part of building pension savings over time.