April proved more constructive than many had expected. A ceasefire in the Middle East helped keep oil prices contained despite ongoing disruption to key shipping routes, while equity markets rebounded strongly. US stocks reached fresh highs, driven in large part by renewed momentum in technology. Although geopolitical risks remain, investor attention has shifted back toward earnings and innovation—for now.
April was a far more supportive month for markets than anticipated at the end of March. Concerns over a prolonged escalation in the Middle East eased as the ceasefire broadly held, helping limit upward pressure on oil prices. That said, disruption through the Strait of Hormuz continues, with implications not just for energy, but also for areas such as fertiliser and semiconductor production inputs.
Markets responded quickly. Two of the three major US indices reached new all-time highs, supported in part by efforts to offset supply disruption through alternative transport routes and strategic reserves. However, as the month progressed, some of that confidence began to look tested, with oil prices edging higher again—highlighting that risks have not disappeared.
Technology stocks provided another key pillar of support. Earlier concerns around heavy spending—particularly on AI infrastructure—had raised questions about profitability and cash returns. Yet sentiment improved as investors became more comfortable that this investment cycle could deliver meaningful long-term gains. As a result, the sector once again played a leading role in driving markets higher.
Overall, April was a reminder of how quickly sentiment can shift. Just weeks after concerns around conflict, inflation and slowing growth dominated, focus has returned to corporate earnings and technological progress.
Bottom Line
While unsettling headlines can create a temptation to act, staying the course often remains the most effective approach—particularly when events are evolving rapidly and outcomes are uncertain. Markets may have moved on from Middle East tensions for now, but it would be sensible to expect them to re-emerge as a focus at some point.
Q&A
What’s driving technology share prices?
Artificial intelligence continues to dominate market narratives, with major technology firms investing heavily in infrastructure such as data centres and chips. Semiconductor companies have been key beneficiaries of this trend.
A central question has been whether this level of spending will translate into profits. Recent announcements from companies like Microsoft and Meta—cutting over 16,000 roles combined—suggest a shift toward efficiency, freeing up capital for further AI investment. At the same time, AI capabilities are advancing, with systems increasingly able to handle complex tasks and workflows, strengthening the case for productivity gains.
Concerns around energy demand have also eased slightly, as large technology firms explore dedicated power solutions to support growing infrastructure needs.
What’s next for inflation and interest rates?
Before late February, inflation had been easing across most developed markets, and expectations were building for continued rate cuts. However, disruption to global oil supply has complicated this outlook.
In the UK, rising energy prices have pushed inflation higher again, prompting markets to consider the possibility of rate increases. The Bank of England held rates at 3.75% in April, awaiting further clarity. The US Federal Reserve and European Central Bank took a similar approach, balancing persistent inflation concerns with signs of softer economic momentum.
For now, central banks remain cautious, carefully weighing inflation risks against the need to support growth.
Private credit – what is lurking in the shadows?
Private credit has grown rapidly over the past decade, with the market now estimated at around $4 trillion. While it offers attractive, relatively stable returns, it also presents challenges—particularly around transparency and liquidity.
Many underlying loans are difficult to sell quickly, yet some investors expect easy access to their capital. As private credit has become more accessible to retail investors, this mismatch has become more apparent, with some funds introducing limits on withdrawals.
While risks currently appear contained and a systemic crisis is unlikely, the structure of these investments means a degree of caution is warranted. Understanding the underlying liquidity profile is key.
Month by Numbers (As at 30th April 2026)
Equities
- UK: +2.10%
- Europe: +5.19%
- US: +10.47%
- Emerging Markets: +13.26%
- Japan: +7.52%
Bonds / Rates
- UK Base Rate: 0.00% change (3.75%)
- Fed Funds Rate: 0.00% change (3.75%)
- UK 10-Year Yield: +0.18% (5.04%)
- US 10-Year Yield: +0.06% (4.38%)
Currencies
- GBP/USD: +3.03% ($1.36)
- GBP/EUR: +1.75% (€1.16)
- DXY (USD Index): -1.55% (98.06)
Commodities
- Gold: -1.10% ($4,622.9)
- Oil (Brent): +6.22% ($110.44)
Noteworthy
- Intel Corporation: +96.84%