Comgest Growth America Fund Q1 2026: Quality Growth Strategy Tested as US Equities Fall 4.4%

The first quarter of 2026 proved challenging for US equities. While the S&P 500 dropped by 4.4%, the Comgest Growth America Fund dipped by 8.8%.

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Managing $685.5 million across a concentrated portfolio of 33 holdings, the strategy remained anchored in bottom-up stock selection.

Market Environment: AI Disruption and Geopolitics Shape Investor Sentiment

US equity markets experienced a turbulent start to 2026, with two major shocks driving volatility during the quarter. The first shock stemmed from the rapid emergence of agentic artificial intelligence tools. This development sparked concerns over traditional Software-as-a-Service business models. Investors questioned whether seat-based subscription models could maintain their long-term pricing power and resilience in an increasingly AI-driven environment. As a result, software and high-valuation technology names experienced a broad sell-off.

Market conditions deteriorated further following US military action against Iran, which pushed Brent crude prices close to $120 per barrel in March. The surge in oil prices intensified broad inflation concerns, pressured consumer and industrial sectors, and drove Treasury yields sharply higher. Further uncertainty emerged after the US Supreme Court invalidated former President Trump’s tariffs, which were subsequently replaced with a new 15% global levy. The replacement reinforced fears around trade policy instability.