Investors will keep a close eye on a possible (de)escalation in Iran, similar to previous weeks.

US Rates: Neutral nominal duration - we prefer inflation protection while monitoring the Fed transition closely

Bond markets are pricing the war in Iran. Equity markets are not. That divergence has become a defining feature in the past month. The conflict has now moved beyond the initial shock phase and has entered a regime of repeated escalation, partial de-escalation and unresolved disruption.

European equities have experienced a slight contraction since the last Equity Committee in April, amid several macroeconomic headwinds. The collapse of Middle East ceasefire talks renewed geopolitical concerns and disrupted supply chains.

Why has the enthusiasm for sustainable investing lost its lustre? A lag in performance of sustainable European equities relative to the broader European equity markets over the last three years hasn’t helped. Sector rotation in equities is often blamed for this downturn in returns. .

April was dominated by the interaction between resilient global activity and a renewed energy shock linked to the Middle East conflict and impaired traffic through the Strait of Hormuz.

The environmental transition has entered a new phase. What was once seen as a gradual, policy-led shift is unfolding as a faster, economically driven transformation. Technology, cost dynamics and rising physical risks are converging, turning environmental change into a central force redefining growth, capital allocation and corporate strategy.

As traffic through the Strait of Hormuz has been virtually closed for 80 days, investors continue looking for signals of easing tension.