Q2 2026 Market & Investment Review: What Happened and What It Means for You

The second quarter of 2026 reminded us of something we've seen time and time again: markets don't like uncertainty, but they are remarkably resilient.

From conflict in the Middle East and rising oil prices to South Africa's first Fitch credit rating upgrade in over 20 years, there was certainly no shortage of headlines. Yet despite all the noise, many markets recovered well, South Africa showed encouraging signs of resilience, and investors who stayed focused on their long-term plans were rewarded.

Here's a look at some of the biggest developments from the past quarter.

Global markets faced uncertainty, but kept moving

The biggest story of the quarter was the conflict involving Iran, Israel and the United States. Concerns around oil supply pushed Brent crude prices sharply higher before easing again as ceasefire negotiations progressed.

While the situation remains fragile, markets responded positively to signs of de-escalation. It's another reminder of how quickly sentiment can change and why reacting emotionally to headlines often does more harm than good.

At the same time, central banks around the world continued navigating inflation pressures. The United States, Europe and the United Kingdom all faced their own economic and political challenges, creating additional uncertainty across global markets.

Despite this, investor confidence in growth assets remained surprisingly strong throughout the quarter.

South Africa proved more resilient than expected

Closer to home, South Africa delivered several encouraging developments.

The rand remained relatively stable despite global uncertainty, while foreign investors returned to South African government bonds after significant outflows earlier this year.

One of the quarter's biggest milestones came when Fitch upgraded South Africa's credit rating for the first time in almost 21 years. Together with recent positive signals from Moody's and S&P, this reflects growing confidence in the country's fiscal discipline and economic direction.

Economic growth also surprised modestly to the upside, although political uncertainty and upcoming local government elections remain important factors to monitor.

Interest rates moved higher again

After a period of easing, the South African Reserve Bank increased the repo rate by 25 basis points during May.

The decision was largely driven by inflation concerns linked to higher oil and food prices.

While further increases remain possible if global conditions worsen, current expectations suggest the Reserve Bank may keep rates unchanged at its next Monetary Policy Committee meeting.

Why staying invested still matters

This quarter provided another excellent example of why long-term investing remains so important.

Markets experienced significant volatility during the height of the Middle East conflict, but many of those losses reversed as conditions improved.

Investors who made emotional decisions during the worst of the uncertainty may have missed much of the recovery.

Successful investing isn't about predicting every headline. It's about building a strategy that can weather both the good times and the challenging ones.

3-Fold Portfolio Performance

Despite the uncertain environment, the 3-Fold model portfolios continued to deliver solid long-term results.

3-Fold Income Portfolio

The Income Portfolio returned 13.32% over the past year and 10.04% per annum over the past five years, outperforming its benchmark across every measured period. Its conservative allocation also resulted in a relatively small maximum drawdown of -2.09%, making it well suited to investors seeking stability and income.

3-Fold Balanced Portfolio

The Balanced Portfolio delivered a 15.76% one-year return and continued to outperform its benchmark over both the three- and five-year periods. As expected from a portfolio with greater exposure to growth assets, it experienced higher short-term volatility while remaining focused on long-term capital growth.

3-Fold Multi-Strategy Hedge Fund Portfolio

The Hedge Fund Portfolio returned 11.74% over the past year, while maintaining a low maximum drawdown of -2.34%. Its diversified investment approach continues to provide investors with an alternative source of returns while helping reduce overall portfolio volatility.

Past performance is not indicative of future performance. Investment decisions should always be made in consultation with your financial adviser and aligned with your personal financial goals, risk profile and investment horizon.

What we'll be watching during Q3

As we move into the next quarter, several key developments will remain in focus:

• Whether the Middle East ceasefire continues to hold.

• The South African Reserve Bank's next interest rate decision.

• South Africa's local government election build-up and political developments.

• Potential further credit rating upgrades.

• Ongoing global inflation and economic growth trends.

Final thoughts

If the second quarter taught investors anything, it's that uncertainty is part of investing.

There will always be geopolitical events, market swings and unexpected headlines. The key isn't trying to predict every twist and turn. It's having a well-structured financial plan and staying focused on your long-term goals.

At Corona Financial Services, we believe informed investors make better decisions. If you'd like to discuss how recent market developments may affect your own financial plan or investment portfolio, we'd be happy to help.

Because successful investing isn't about reacting to the news. It's about staying prepared for whatever comes next.