9th Dec 2024 11:00
(Alliance News) - JPMorgan European Discovery Trust PLC on Monday announced a lower net asset value, dragged down by industrials, but the investment trust highlighted a very optimistic outlook.
The investor for capital growth in smaller companies in continental Europe said net asset value per share fell 2.1% to 509.9 pence on September 30 from 520.7p on March 31.
NAV total return during the half-year was negative 0.5%, underperforming against its benchmark, the MSCI Europe excluding UK small cap index, which had a return of positive 1.0%.
The largest contributor to returns was the real estate sector, while the largest detractors were industrials, consumer discretionary and financials.
JPMorgan European Discovery declared an interim dividend of 3.0p per share, up 20% from 2.5p a year ago.
Looking ahead, the company noted escalating political uncertainty but said it remained focused on identifying "Europe's 'hidden gems'".
"Macroeconomic developments over the review period have been decisively positive. Looking across the asset class, we expect the easing of monetary headwinds and improving economic growth indicators to be favourable for economically geared smaller companies."
Portfolio managers Jon Ingram, Jack Featherby and Jules Bloch said: "We anticipate that the combination of attractive valuations, supportive macroeconomic conditions, and long-term thematic drivers will serve as significant catalysts for European smaller companies. This sector of the market has outperformed most other major public asset classes globally over the past two decades, and after a protracted period of underperformance, these stocks are overdue for a resurgence. As we said in our last report, the outlook has rarely been brighter, and we look forward to reporting the company's progress on capturing this recovery as it unfolds."
JPMorgan European Discovery shares were 0.4% lower at 442.28 pence each on Monday morning in London.
By Tom Budszus, Alliance News slot editor
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