US Market Poised to Price in Latest News, from Tuesday
Paper Mandate Market & Portfolio Commentary | 25 May 2026
Fund Status:
Bal Start: $1,091,811
Bought BVS
Sold: WDS
Bal End: $1,106,974
Cash: $136,056
Market Commentary
Over the weekend, Kevin Warsh was officially sworn in as the next Chair of the Federal Reserve. The market will be watching him closely at the next meeting. US/Iran negotiations are presumably near an end according to communications from the Trump Administration. Key points of discussion include the reopening and management of the Strait, though Iran insists they will remain in control of the Strait. On Friday the US market ended higher, but we won’t actually see how they will price the latest news until Tuesday evening (Australia time) as they have a public holiday Monday 25th. The Iran deal could still fail. Even if it is finalised, critical infrastructure has been damaged. It will be a while before the world returns to pre-war energy prices, if ever.
For the ASX, not a bad day at all with the ASX200 finishing slightly up. Interestingly the tech sector had a volatile session, sinking until about lunch time before recovering to a soft finish (-0.45%) by EOD. Materials was the outperforming sector (+1.84%) while Energy (-2.41%) was the laggard. Unsurprising given the market anticipating a deal from the US/Iran conflict to emerge. The Gold index (XGD) was also a standout, rallying +4.93% for the day. PC2 and OBM benefiting here. A disappointing development for GYG occurred just as markets were closing as a group of U.S. employees have sued, alleging GYG did not give prior notice to staff before closing all its Chicago restaurants.
Portfolio Commentary
Portfolio did nicely today, generating +1.39% to the ASX300 +0.42%. As we approach the end of our second month, this will give us a better picture of the return drivers.
In terms of portfolio positioning, we halved the WDS position. If positive news regarding the US/Iran deal comes through, the stock will likely sell off. While I still believe the long-term effects on the energy market will be positive for producer like WDS, you can’t fight market momentum or sentiment.
We did, however, initiate a position in Bravura Solutions (BVS). A software company that provides services for the wealth and funds management industry. They recently have had a pull back, provide saw an opportunity to take a small position.
I’m conscious that the fund is now 28% in Tech, well above the Index 2.1% weight. Checking my rules, now more than 30% single sector weight. Even now it feels like a bit much.
Investment Activity
Disclaimer: This is a paper portfolio. Content is for educational purposes only and does not constitute financial advice. Always do your own research.