Company Interview / The one key takeaway from a volatile market

Key points:

Volatility seen as opportunity arising from mispricing, not just risk Focus on long‑term fundamentals to navigate shifting energy and macro conditions China tech, Microsoft (NASDAQ:MSFT) and Booking Holdings (NASDAQ:BKNG) cited as potentially mispriced Energy‑importing markets such as South Korea and Japan viewed as vulnerable to higher energy costs

Vesna Peroska from Morningstar frames the current spike in market volatility as mainly driven by uncertainty around energy prices and their impact on economic fundamentals. Peroska states that heightened volatility tends to create mispricing, where quality businesses are sold off along with weaker names. The approach, in Peroska’s view, is to lean on a clear investment philosophy, focus on business fundamentals and use drawdowns to buy assets more cheaply for potentially stronger long‑term returns.

Peroska advocates looking through short‑term headlines and avoiding frequent trading, which is seen as risking “buying high and selling low”. However, Peroska also notes that this episode is more complex, as fundamentals themselves are shifting due to the prospect of structurally higher energy prices, widening the range of possible outcomes for both economies and companies.

On opportunities, Peroska highlights oversold China tech names, where positions are being added, consistent with a positive stance on emerging markets and China equities. Morningstar Equity Research is cited as viewing companies such as Microsoft (NASDAQ:MSFT) and Booking Holdings (NASDAQ:BKNG) as having enduring business value despite AI disruption concerns. Peroska also points to pressure on markets like South Korea and Japan, particularly energy‑importing exporters facing rising input costs.