Mixed picture on September stock markets

Mixed returns for the Peaks portfolios

In August the sun shone on the stock markets, but in September the weather turned. Inflation remains high and persistent, which led both the American and the European Central Bank to raise interest rates. The combination of higher interest rates, rising oil prices and geopolitical uncertainty brought bleak autumn winds to the European and US bond markets. 

This is clearly reflected in the returns of the Peaks portfolios. The portfolios with relatively many bonds (Cautious and Balanced) fell slightly in value, while the portfolios with relatively many stocks (Ambitious and Adventurous) actually rose slightly in value. That said, all portfolios are still clearly in positive territory since the start of this year, and 2026 is still a very good stock market year compared with the average return of the portfolios since the launch of Peaks.

Table 1: Net returns of Peaks portfolios

*On 22 November 2017

Important to know: These net returns reflect Peaks' portfolios in September 2026, all of 2026 and since the launch of Peaks, after deducting Peaks, fund, and transaction fees. The value of investments can fluctuate, and past performance is no guarantee of future results.

The above figures assume a portfolio value of €10,000 without any deposits or withdrawals. If you made deposits or withdrawals this month, your personal return may differ. Your return will also vary if you have invested less or more than €10,000 due to the monthly fees Peaks charges.

As in August, September was relatively calm in terms of price fluctuations (volatility). 

Table 2: Risk of Peaks portfolios

*On 22 November 2017

Important to know: This table shows the risk levels of the 4 Peaks portfolios over different time periods (last month, this year, and the average since Peaks launched). Risk, also known as volatility, reflects the variation in annualised returns and is measured using the standard deviation of daily net returns converted to an annual basis.

Central banks raise interest rates again

In September, central banks on both sides of the Atlantic Ocean came to the same conclusion: inflation is too high and needs to be slowed down.

On 10 September, the European Central Bank (ECB) raised the deposit rate by 0.25%, from 2.25% to 2.50%, because inflation in the eurozone has been too high for some time. In September, inflation rose to 3.8% year on year, compared with 3.2% in August. This was more than analysts had expected and much higher than the ECB's inflation target of just under 2%.

Following the ECB, the US Federal Reserve also raised its policy rate by 0.25% on 16 September, to a range of 3.75% to 4.00%. It was the first interest rate rise in 3 years. US inflation rose to 3.7% in September, up from 3.4% in August. 

These rate moves also caused a sharp rise in interest rates on the capital market (the US 10-year rate climbed above 5%). This led to one of the worst months for bonds in years. 

Effect of rising interest rates on bonds

The reason bonds fall in value when interest rates rise is that existing bonds pay a lower interest rate than newly issued bonds. Because of this interest rate disadvantage, the price of existing bonds falls. This is clearly reflected in the negative returns of the bond ETFs (see the table below).

It's important to mention that the price drop (the interest rate disadvantage) is temporary. Bonds (loans) have a fixed term, after which they are repaid. As the remaining term of the bonds gets shorter, the price rises towards the nominal value (the amount that was borrowed and will be repaid). Once the bond has been repaid, the ETF automatically buys a new bond with a higher interest rate. 

Table 3: Net returns of the index funds included in the standard Peaks portfolios

Important to know: These net returns reflect the performance of index funds in September 2026, all of 2026, and since Peaks launched, after deducting Peaks, fund, and transaction fees. The value of investments can fluctuate, and past performance is no guarantee of future results.

Unrest in the Middle East pushes up energy prices

The main driver behind the persistent inflationary pressure can be found on the geopolitical stage. Talks between the US and Iran stalled again in September. Iran is blocking the Strait of Hormuz, a crucial shipping route for oil and gas exports from the Middle East. In addition, the Houthis attacked Saudi Arabia and threatened shipping in the Bab el-Mandeb Strait. Like the Strait of Hormuz, this is an important shipping route for transporting oil and gas to the rest of the world. 

As a result, energy prices rose sharply in September. A 159-litre barrel of (Brent) oil rose from $88 to $98 in the space of 1 month. By now (mid-October), the price has even reached $110. 

Rising fuel costs feed through into companies' production and transport chains. If energy prices remain high for a long time, companies have to raise the prices of their goods. This drives up inflation. Investors now fear that energy prices will remain high for a long time, as there is still no end in sight to the conflict between the United States and Iran. This could mean that inflation remains high for the time being, interest rates rise further and economic growth slows. 

What does this mean for your Peaks portfolio?

September is yet another reminder that stock prices never move upwards in a straight line. Fluctuations (and dips) are simply part of investing. So is uncertainty in the world. Periods of greater uncertainty and tension simply happen, and they can translate into falling stock prices, although this is not a given. 

Ultimately, nobody can predict the future. But what history shows is that sticking to your long-term strategy works best in the end:

1. Deposit automatically. By depositing a fixed amount every month, you automatically buy more ETFs when prices fall.
2. Diversify widely. The Peaks portfolios invest worldwide in thousands of companies and bonds, making you less vulnerable to problems at individual companies. 

In short, stay calm and keep your eye on the long term, whatever happens this autumn.