Second Quarter 2026 Newsletter

Market Commentary

Financial markets rebounded strongly during the second quarter, led primarily by equities. Fixed income generated more modest returns, while commodities generally weakened over the period.

Although market sentiment improved over the quarter, uncertainty remains a defining characteristic of the current investment environment. As always, we believe it is important to distinguish between short-term market narratives and long-term investment fundamentals. Our focus remains on maintaining disciplined, diversified portfolios designed to withstand a broad range of potential economic and market outcomes.

Here are the key quarter and YTD market highlights:

• Equities

  • S&P 500: +15.1% / +10.1%

  • TSX 60 +8.2% / +11.5%

  • Global Equities: +14.7% / +13.4%

  
  

• Bonds

  • US Bonds: +0.7% / +0.7%

  • Canadian Bonds: +2.0% / +2.2%

  • High Yield: +2.3% / +1.9%

  
  

• Balanced Portfolios

  • Global 60/40: +8.2% / +8.5%

Fortress Portfolio Positioning and Outlook

The Anchor Pacific Fortress Portfolios are constructed with the objective of delivering consistent, long-term returns across the spectrum of economic and market environments. We operate from a single core investment model and tailor asset allocation and investment selection to each client's unique risk tolerance, investment objectives, time horizon, and capacity for short-term volatility.

Following our ongoing portfolio review during the second quarter, our strategic asset allocation remains largely unchanged. We believe the portfolio continues to provide an appropriate balance between growth opportunities, income generation, diversification, and risk management, especially given today’s present market environment.  

While we continuously evaluate new information and changing market conditions, portfolio adjustments are principally guided by long-term fundamentals and made only when they are expected to meaningfully improve the portfolio's long-term risk and return characteristics.

Our present asset allocation for the Fortress Balanced Model Portfolio which targets an asset mix of 40% higher-risk assets (shown in purple), 40% medium-risk assets (blue), and 20% defensive assets (green), is below

Fortress Portfolio Asset Allocation

The following chart shows how the portfolio’s asset sector composition changed from the most recent quarter.

Looking Ahead

As we move through the remainder of 2026, we continue to closely monitor several key themes that we believe have the potential to influence returns:

• Geopolitical developments and their impact on global trade, supply chains, and commodities

• Inflation, economic growth, and interest rate expectations

• Fiscal policy, government debt, and long-term sovereign borrowing trends

• The evolving relationship between stock and bond markets

• Equity valuations across regions, sectors, and investment styles

• Technological innovation, artificial intelligence, and developments within private markets

Rather than attempting to predict how any single risk factor will unfold or making broad macroeconomic market calls, our focus remains on constructing portfolios that are resilient by design, capable of adapting to changing conditions while remaining aligned with long-term client goals and objectives. Should changing market conditions warrant, future portfolio adjustments as always will be measured, incremental, and purposeful. 

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2026 Q2 Commentary.pdf

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