2nd Aug 2019 11:13
(Alliance News) - Fidelity European Values PLC said Friday it outperformed its benchmark in the first half of 2019, as market conditions improved during the period.
In the six months to the end of June, the European-focused investor recorded a net asset value total return of 19.9%, outperforming the FTSE World Europe (Excluding UK) Index, which returned 17.5%.
Net asset value per share as at June 30 was 270.90 pence, up 8.7% from 249.12p the year before.
Fidelity European said its net asset value outperformance was due to gearing over the period, as well as the decline in bond yields as the US Federal Reserve started to "pivot" away from monetary tightening, which aided some of the the investment trust's larger holdings, including Nestle.
Portfolio-wise, luxury goods conglomerate LVMH and private equity firm 3i Group stood out as the strongest performers, while automobile stocks lagged amid a declining Chinese market and concerns over higher US tariffs.
Fidelity European declared an interim dividend of 2.59 pence per share, after declaring no dividend for the year before.
Looking ahead, Fidelity European said that geopolitical risks remain, including the trade-dispute between the US and China, as well as concerns over the scale of monetary easing in the months end, which could spell an end to the long economic and stock market upturn.
"The portfolio manager will, as always, continue to focus on attractively-valued companies which are able to sustain consistent dividend growth. The challenge of finding companies that meet both of those conditions has led to a reduction in the number of names in the portfolio. This suggests that the stock markets of continental Europe may be due a more difficult period ahead," said FIL Investments International, portfolio manager.
Shares in Fidelity European Values were down 1.4% at 250.50 pence on Friday.
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Fidelity European Values