ILIM Quarter in Review: Q3 2026
by Irish Life Financial Services
Written by Irish Life staff
Market News • 23 October 2026 • 3 min read
ILIM Quarter in Review: rising energy prices test markets
This blog was written by Irish Life staff based on content produced by Irish Life's investment managers (ILIM).
Click here to read the ILIM report in full (PDF)
Key takeaways from Q3 2026
Renewed US-Iran tensions and disruption around the Strait of Hormuz pushed energy. prices higher.
Strong company earnings and continued investment in AI helped support global shares.
Inflation concerns returned, prompting interest-rate increases in the US and Europe.
Energy shock returns
Hopes of a lasting resolution to the US-Iran conflict faded during Q3, as disruption around the Strait of Hormuz continued. This raised concerns about energy supplies and shipping, sending oil prices higher.
Higher energy costs added to inflation pressures and created further challenges for household spending and company margins, particularly in Europe.
Market round-up
Market round-up
Global equities
Global shares rose modestly over the quarter, supported by resilient economic activity, strong corporate earnings and continued AI investment.
The MSCI All Country World Index gained 1.3% in Q3, or 2.4% in euro terms. US shares performed strongly, supported by large technology companies and a resilient economy. European shares declined as higher energy costs and borrowing rates weighed on sentiment.
Emerging-market shares fell by 2.8%, although currency movements left them marginally positive for euro-based investors.
Inflation and interest rates
Higher energy prices renewed inflation concerns. In September, the US Federal Reserve raised interest rates by 0.25%, taking its target range to 3.75% to 4.00%.
The European Central Bank also increased its deposit rate by 0.25%, to 2.50%. While the Eurozone economy remained more resilient than expected, higher imported energy costs continued to cloud the outlook.
Bonds and commodities
Bond markets had a difficult quarter as yields rose sharply. The ICE BofA 5+ Year Euro Government Bond Index fell 6.6%, as inflation concerns and expectations of tighter monetary policy weighed on prices.
Commodities rose strongly, led by energy. Brent crude oil increased by 42.0% during the quarter. Gold also rose, supported by geopolitical uncertainty and central-bank buying.
Looking ahead
Resilient growth, strong earnings and AI-related investment continue to support the outlook for equities. However, markets are likely to remain volatile while the conflict in Iran continues and energy prices stay elevated.
A resolution that allows the Strait of Hormuz to fully reopen could ease oil and inflation pressures, providing relief for both shares and bonds.