News & Insights

Growth stocks led the rebound, extended their dominance despite geopolitical noise

Despite a sharp sell-off following Trump’s “Liberation Day” tariff announcements in early April, equity markets staged a remarkable recovery in Q2, shrugging off both trade and geopolitical concerns. Boosted by strong earnings announcements from Big Tech, US equity markets outperformed and ended the quarter at record highs.

The rally was broad, with small-cap stocks performing in line with large-cap, although style was an important factor, with growth stocks once again dominant.

US dollar portfolios surged, buoyed by domestic equity strength and currency tailwinds

There were significant currency moves over the quarter. The US dollar was weak, falling approximately 6% against the pound, 9% against the euro and 11% against the Swiss franc. This volatility in currency markets had a material impact on the performance of the ARC Wealth Indices.

US dollar-denominated portfolios will have experienced a stellar quarter, helped by the strong performance of domestic equities and currency translation effects.

Returns for the other indices are expected to be more modest, and possibly negative in the case of the Swiss franc indices.