Editor’s Pick

With that caveat out of the way, I am reasonably confident we should expect greater volatility and lower returns in 2026. Let me explain why I think that’s a reasonable assessment.

Since 2022, I have suggested that investors maintain a bullish disposition.

This article was first published in The Australian on 04 December 2025. continue…

by Roger Montgomery Posted in Editor's Pick, In the Press.

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National Australia Bank (ASX: NAB) delivered its full-year 2025 (FY25) results on 6 November, posting cash earnings of $7.091 billion – essentially flat on FY24 and a touch below the market’s $7.18 billion consensus.

The share price sold off about two per cent on the day, and we believe the relatively soft trading since is due to investors focusing on two things:

1. Higher-than-expected loan impairment charges (up 14 per cent to A$833 million), driven mainly by missed payments, a handful of individual business banking exposures and some unsecured retail lending stress, and
2. Relatively flat earnings and final dividend 85 cents per share, bringing the full-year dividend per share (DPS) up one cent to 170 cents, fully franked.

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by Roger Montgomery Posted in Companies, Editor's Pick, Financial Services.

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In this blog post, I (finally) take the focus off the artificial intelligence (AI) boom/bubble. Instead, I want to look at whether there are other factors investors should be considering when it comes to time to rebalance portfolios, and as 2025 concludes and 2026 commences.

First – and granted this one’s a bit of fun – the Santa Claus rally. Is there any evidence that such a thing exists? continue…

by Roger Montgomery Posted in Editor's Pick, Global markets, Market commentary, Market Valuation.

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Wall Street’s S&P 500 dropped more than one per cent last week, and the tech-heavy Nasdaq fell three per cent. It’s really nothing in the scheme of things. That’s because the Nasdaq 100 is up more than 130 per cent in three years, and the S&P 500 is more than eighty-five per cent higher since October 2022. Nevertheless, last week’s turn-down was the worst week for the Nasdaq in seven months. What the index price declines perhaps don’t reflect, however, is a much sharper shift in the market’s risk appetite. continue…

by Roger Montgomery Posted in Editor's Pick, Market commentary.

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Since my last column Is there a stock market bubble? Here are the warning signs, which was on the topic of recognising bubbles, subtle shifts have been occurring in the risk postures of major global investors that suggest you now need to behave more cautiously than before.

Some of those behaviours have been reflected in the relative outperformance over the last month of defensive sectors such as healthcare and utilities, beating technology, artificial intelligence (AI) and defence. And some of the same behaviours also reflect the changing picture of liquidity, which, of course, is the fuel that inspires all thematically driven rallies.

This article was first published in The Australian on 30 October 2025. continue…

by Roger Montgomery Posted in Editor's Pick, In the Press, Market commentary.

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While bubble definitions abound, most fall into two camps: those that measure overvaluation and those that observe the behaviours and conditions that typically give rise to it.

The most straightforward definition of a bubble is asset prices climbing far above some measure of value, such as earnings, dividends, gross-value-added (GVA) or discounted cash flows. Robert Shiller’s famous CAPE ratio, which compares stock prices to long-term average earnings, and John Hussman’s market-cap-to-GVA, were designed to flag these distortions. continue…

by Roger Montgomery Posted in Editor's Pick, Global markets, Insightful Insights, Investing Education, Market commentary.

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CrossBorder Capital’s latest report by founder Michael Howell paints an ominous picture of a maturing global liquidity cycle, raising concerns that the U.S. Federal Reserve’s (the Fed) waning role in providing liquidity (the fuel for market and asset rises) has negative implications for markets and the U.S. economy.

Howell’s analysis concentrates on the September Federal Open Market Committee (FOMC) meeting, where a 25-basis-point rate cut was delivered alongside hints of further cuts, consistent with Trump’s demands. Yet, he labels this a “hawkish cut,” emphasising the Fed’s tough stance on liquidity. Fed Chair Jerome Powell, incoming appointee Stephen Miran, and Treasury Secretary Scott Bessent are reportedly aligned in their push to shrink the Fed’s balance sheet and minimise its market influence. continue…

by Roger Montgomery Posted in Editor's Pick, Global markets, Market commentary.

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Last week, The Wall Street Journal (WSJ) published a piece commenting on the artificial intelligence (AI) infrastructure frenzy. As an investor, one can’t help but be awestruck while also feeling concern and a more than a hint of déjà vu.

According to the WSJ, Ellendale, North Dakota, is a sleepy town of just 1,100 now playing host to a half-built AI data centre that’s will be larger than 10 Home Depots – the U.S. equivalent of a large format Bunnings Warehouse here in Australia. continue…

by Roger Montgomery Posted in Editor's Pick, Global markets, Market commentary, Technology & Telecommunications.

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In 2025, so far, the seven most influential U.S. tech giants – The Magnificent Seven, or Mag 7 (Alphabet, Amazon, Apple, Microsoft, Meta Platforms, Tesla and Nvidia) – have continued to assert their dominance and reinforce their role in determining the S&P 500’s trajectory. Despite what appears to be artificial intelligence (AI) hype, or perhaps because of it, the seven giants have collectively outpaced the broader S&P 500’s 12.47 per cent year-to-date (YTD) rise, delivering a gain of 15.9 per cent through Monday’s close. At the same time, however, their market-capitalisation share has dropped slightly from a peak of 32.2 per cent in mid-August to 31.3 per cent of the S&P 500’s total value. That indicates some stocks outside of the Mag 7 have been outperforming them. continue…

by Roger Montgomery Posted in Companies, Editor's Pick, Stocks We Like, Technology & Telecommunications.

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The Magnificent Seven; Alphabet (NASDAQ:GOOG), Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), Meta (NASDAQ:META), Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA), and Tesla (NASDAQ:TSLA), which rose by an average 111 per cent over calendar 2023, continued its strong upward trajectory, increasing a further 63 per cent, on average, over calendar year 2024. continue…

by David Buckland Posted in Economics, Editor's Pick, Foreign Currency, Market commentary.

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