Fidelity Emerging Markets Limited (LON:FEML) has announced its monthly factsheet for September 2023.
Emerging markets declined in September and marginally underperformed developed markets. US Treasury yields reached near multi-year highs after the US Federal Reserve signalled that interest rates could remain higher for longer. A rise in oil prices added to concerns about continued inflationary pressures. On a positive note, the People’s Bank of China’s monetary policy support for the economy buoyed markets. All regions posted negative returns, led by Emerging Europe, Middle East, and Africa (EMEA), followed by Emerging Asia and Latin America.
The portfolio marginally outperformed the index over the month. Stock selection in the consumer discretionary and materials sectors contributed the most to performance, with a number of short positions driving relative returns. These include short positions in a Brazilian retailer, an Asian battery manufacturer, and a North American silver miner.
The exposure to the financial sector weighed on performance, with Hong Kong-based insurer AIA Group and Greek banks, National Bank of Greece and Piraeus Financial particularly weak. Performance of names held within the financial sector was mixed, however, with Axis Bank (India) and Nu Holdings (Brazil) contributing positively over the month.
The Trust’s NAV rose 3.2% during the 12-month period ended 30 September 2023, outperforming its reference index which rose by 2.2%. The Trust’s share price rose 5.6% over the same period.
Fidelity Emerging Markets Limited (LON:FEML) is an investment trust that aims to achieve long-term capital growth from an actively managed portfolio made up primarily of securities and financial instruments providing exposure to emerging markets companies, both listed and unlisted.
