Fidelity European Trust PLC (LON:FEV) monthly factsheet for February 2024.
Portfolio Manager Commentary
Continental European equities rose but lagged broader equity indices over the month. Markets were supported by resilient corporate results despite disappointing economic data and a pushing back of expectations for interest rate cuts. Although inflation remains on track to reach the ECB’s 2% target level, minutes from their latest meeting suggested that policymakers agreed it was premature to discuss rate cuts due to rapid wage growth and underlying price pressures. The eurozone economy avoided a recession in Q4 2023, but economic growth remained sluggish despite employment growth outpacing forecasts.
During the month, the Trust delivered positive returns and performed in line with the index. Positive positioning in the utilities, healthcare and communication services sectors was offset by weaker stock selection in industrials and financials and positioning in the consumer sectors. At a stock level, luxury business Hermes gained after reporting strong fourth quarter results, supported by growth across all product categories. ASML continued to rise after delivering strong FY23 results last month and following positive sentiment towards the semiconductor sector after Nvidia released strong results in February. Conversely, Spanish booking platform Amadeus IT and food business Nestlé were the key detractors.
On a rolling 12-month basis, the Trust recorded NAV and share price returns of 13.7% and 11.9% respectively, compared to 10.7% for the index.
Fidelity European Trust PLC (LON:FEV) is a European investment trust. It aims to be the cornerstone long-term investment of choice for those seeking European exposure across market cycles.
