- European markets lag the US on Trump election, before rallying towards the end of the month.
- 3i Group the portfolio’s biggest monthly mover, rallying sharply after interim results show a better-than-expected investment return.
- Q3 reporting season shaped portfolio returns, with Intercontinental Hotels Group and Rightmove rallying while Solvay and Kingspan gave up ground.
The Fund’s A5 share class returned 1.2%* in euro terms in November. This Fund’s target benchmark, the MSCI Europe Index, returned 1.1%.
While Donald Trump’s election victory prompted a strong rally in US shares on the anticipation of market-friendly policies, investors in Europe were less sure what to make of events. The prospect of trade frictions caused some concern, but sentiment improved towards month end and the market rallied. From a sector perspective, IT (+4.3%), communication services (+3.3%) and industrials (+2.9%) fared well while materials (-1.8%) and consumer discretionary (-1.2%) slid the most.
Having released better-than-expected Q3 results showing 1.5% revenue per available room in October, shares in Intercontinental Hotels Group (+16%) benefitted from upgrades to broker earnings estimates in November.
Online property listing portal Rightmove (+11%) rose on a reassuring update covering the four months to 31 October. The company confirmed 2024 guidance and commented on greater optimism among its estate agent partners due to improving transaction flow, positive if subdued house price growth and stable mortgage rates.
Private equity investment company 3i Group (+20%) rose as its interim results showed a total investment return of 10% in the six months to 30 September, ahead of analyst forecasts. The gain comes from the revaluation of its private equity holdings, the largest of which is Action, the Dutch discount retailer. 3i commented that while Action continues to deliver good sales growth, it has also seen resilient trading against a mixed macroeconomic backdrop from the majority of its private equity holdings.
Kingspan Group (-12%) shares lost some ground as a Q3 trading update indicated 2024 earnings would be in line with the 2023 levels, a touch below investors’ expectations. The insulation and building envelopes specialist has seen subdued near-term demand but order backlogs at strong levels – suggesting 2025 activity could benefit at the expense of 2024.
Belgian chemicals group Solvay (-12%) also released Q3 numbers that fell short of investor expectations. While Q3 net sales rose 3.9% organically year-on-year, this reflected a positive volume impact. Prices were down, resulting in underling EBITDA falling very slightly (-0.3%). Solvay maintained its 2024 outlook.
UniCredit (-8.5%), the international bank based in Italy, has turned its acquisitive attentions from Germany’s Commerzbank towards domestic competitor BPM. At this stage it remains highly uncertain the $10.5bn offer will be successful.
Positive contributors to performance included:
3i Group (+20%), Intercontinental Hotels Group (+16%) and Rightmove (+11%).
Negative contributors to performance included:
Solvay (-12%), Kingspan Group (-12%) and UniCredit (-8.5%)
KEY RISKS
Past performance is not a guide to future performance. The value of an investment and the income generated from it can fall as well as rise and is not guaranteed. You may get back less than you originally invested.
Overseas investments may carry a higher currency risk. They are valued by reference to their local currency which may move up or down when compared to the currency of the Fund. This Fund may have a concentrated portfolio, i.e. hold a limited number of investments (35 or fewer) or have significant sector or factor exposures. If one of these investments or sectors / factors fall in value this can have a greater impact on The Fund's value than if it held a larger number of investments across a more diversified portfolio. The fund’s investment objective is to target capital growth for investors. Growth stocks tend to pay out lower levels of dividend resulting in lower income yields and may produce more volatile returns than the market as a whole. Outside of normal conditions, the Fund may hold higher levels of cash which may be deposited with several credit counterparties (e.g. international banks). A credit risk arises should one or more of these counterparties be unable to return the deposited cash. The issue of units/shares in Liontrust Funds may be subject to an initial charge, which will have an impact on the realisable value of the investment, particularly in the short term. Investments should always be considered as long term.
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