Melbourne-headquartered global equities firm Munro Partners, which oversees $7.6 billion in assets, maintains a constructive outlook for growth equities, believing the bull market will continue into 2026. Kieran Moore, a portfolio manager at the firm, notes that while their global growth portfolios have faced short-term challenges over one, three, and six-month horizons, the long-term view remains positive. A significant driver for this optimism is the anticipated ongoing spending on artificial intelligence infrastructure, which is expected to bolster earnings growth for numerous companies involved in building the necessary compute capabilities.
Moore also indicated that short-term market volatility stemming from geopolitical conflict in the Middle East is likely to be a temporary issue for equity markets, further supporting their constructive stance for the remainder of the year. Discussing the recent US earnings season, he observed that while only a limited number of companies have reported, the results seen so far have reinforced Munro’s bullish perspective on growth equities. Taiwan Semiconductor Manufacturing Company (TSMC), a key manufacturer of leading semiconductors, delivered a strong outlook, citing significant demand from the artificial intelligence sector, which aligns with their investment thesis.
In a notable portfolio adjustment, Munro Partners recently exited its long-held position in Microsoft. The decision followed the firm’s stop-loss process, triggered by a significant share price fall. The team assessed that Microsoft is currently navigating capital allocation challenges between investing heavily in its core software offerings and aggressively pursuing the artificial intelligence opportunity, particularly within its Azure cloud business. Munro looks forward to potentially re-investing in the future. The firm also highlighted CATL, a Chinese battery manufacturer with high global market share in electric vehicle and energy storage markets, as a less-known holding with a strong earnings growth runway. Surprisingly, Munro believes Nvidia remains undervalued by the market, trading at a significant discount to the S&P500 given its fast growth and pivotal role in the AI transformation.
