Markets have bounced back with AI leading the charge
- jerome984
- Sep 13
- 4 min read
Now that we’ve reached September, we can see that stock markets have done well overall in 2025. This is despite the blip in April, caused by Donald Trump’s ‘Liberation Day’ tariffs.
This is also the first time in history where we have a U.S. president telling the Federal Reserve how interest rates should be behaving. This is likely to lead to an interest rate decrease, which is positive news for stock markets. This positive news is coupled with wariness around the potential bubble of the AI sector, which is sitting at particularly high valuations.
We recommend seeking advice to ensure your investments are not vulnerable to concentration risk, especially if you’re close to retirement or are already drawing an income from your portfolio.
Get in touch today, our team is always happy to help.
Is AI a bubble?
With Artificial Intelligence (AI) valuations climbing, many NZ investors and financial advisers are starting to ask whether we’re seeing the early signs of a bubble.
According to a recent article from The Verge, Sam Altman, the CEO of OpenAI, shared that he believes the artificial intelligence market is currently in a bubble.
We certainly see some similarities with the current AI-driven market performance and the dotcom bubble of the late 1990s: investor hype around game-changing technology, the rise of tech-heavy indexes, and gains concentrated around a handful of large-cap stocks.
One of these large-cap stocks includes Nvidia, which has surged in recent years due to the growth in demand of AI chips. Nvidia’s current market share is so significant that it accounts for a large part of various market indexes.
When one company is dominating, portfolios are increasingly vulnerable to concentration risk, which can lead to significant losses if a particular company, or market segment performs poorly.
While we do see elements of a bubble in the current market situation, we also believe that there are enough factors that could see AI continue to maintain relevance including the productivity benefits and AI being embedded into core business models.
Whether AI is a bubble or not, it’s important to get advice to ensure your portfolio is well-diversified. We are always happy to discuss your financial matters and any concerns you may have around your portfolio’s diversification.
Retirement: coming sooner than you think
Whether you’re a few years away, or it’s a distant future, retirement hits faster than you realise.
We recently came across a New Zealand Herald article that stated most New Zealanders are not prepared for retirement.
We help many clients put together successful retirement plans. There are a few key factors that help lead them to a financially comfortable and enjoyable retirement:
Pre-retirement planning: It’s never too early or too late to plan for retirement. Having a plan helps to ensure your financial security after you’re finished working so that you can maintain your desired lifestyle and enjoy life.
Planning early: Time is one of the key factors for building wealth. Giving yourself as much time as possible to grow your retirement nest egg makes it far more likely that you are able to fund your desired retirement lifestyle.
Having a goal: Knowing what lifestyle you want in retirement is key to determining how much you actually need to save.
Did you know that with $1 million in retirement savings you can draw down $50,000 per year (net of tax and fees) for 30 years when invested in a middle-risk (balanced) portfolio?
Please reach out to our team for advice on putting together a plan to ensure you have an enjoyable retirement.
Market update
United States
S&P 500, Dow, and Nasdaq reached new record highs in August, with S&P 500 up 1.9% for the month and 9.8% year-to-date.
U.S. GDP was revised higher, but a surprise employment revision signals a softer labour market.
Market expectations centr,te on a September Fed rate cut and strong earnings, even as trade headlines and tariffs remain volatile.
New Zealand
NZ equities posted modest gains as the Reserve Bank held rates steady, taking a wait-and-see approach amid mixed global signals. Data suggests that the Official Cash Rate (OCR) will see a cut at the next OCR review in October.
Investor sentiment is supported by stable domestic data but cautious given lagging global rate moves and regional trade uncertainty.
Global fund manager Nikko Asset Management officially rebranded to Amova Asset Management on 1 September, 2025, reflecting a fresh global identity while maintaining its New Zealand presence and the GoalsGetter KiwiSaver platform.
Australia
The ASX advanced in August, driven by strong resource stocks and solid GDP figures, while inflation remains above target, keeping further rate action in play.
Wage growth and employment data outperformed expectations, supporting further equity strength.
Europe
Eurozone equities, led by banks and cyclical sectors, posted their best two-month run since February; Stoxx 600 rose on strong earnings.
French political tensions and fiscal worries tempered optimism; inflation is contained, and GDP growth now outpaces expectations.
ECB signals caution, watching growth and fiscal policy developments closely.
Asia
Japan’s TOPIX surged on improved GDP and robust manufacturing, contributing to broad Asia-Pacific gains.
China equities rose on tech stimulus and the US-China trade truce, with export optimism supporting regional sentiment.
Other Asian markets benefited from stronger chip sector news and stable macro data.
Team update
Adrian represents NZ at Spirit of Cricket World XI
We wish the best of luck to our Mortgage Specialist, Adrian Dale, who is captaining a New Zealand Over 55’s cricket team in an upcoming quad series in Mildura, Australia, 17-23rd September. He will be competing against teams from Australia and the ‘Rest of the World’ over two weeks of intense cricket.
Staff work anniversaries
Our support team members Jerome and Waruni have both recently celebrated their 1-year work anniversaries.
We congratulate and thank them for their ongoing efforts to provide you with excellent service.
If you would like to discuss your portfolio feel free to contact us.
If you would like to discuss your current portfolio, retirement planning needs, goals-based investing approach, or any other financial planning matters please feel free to give our office a call at 09 553 8928 or email us at info@trilogyfs.co.nz.
We are always happy to help.
Sincerely,
The Team at Trilogy Financial Solutions
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