Fidelity European Trust PLC (LON:FEV) monthly factsheet for July 2025.
Portfolio Manager Commentary
Continental European equities experienced heightened volatility in July, marked by ongoing trade tensions and the beginning of the second-quarter earnings season.
The Trust underperformed the index during the month, primarily due to weak stock picking in the financials and healthcare sectors, while gearing had a small positive impact. Shares in Novo Nordisk detracted significantly over the period, following a profit warning and the announcement of the new CEO. The holding in ASML also declined after the company provided a softer outlook for the 2026 financial year, despite the second-quarter bookings beating expectations. On a positive note, the Trust’s exposure to French industrial group Legrand was the biggest contributor. Shares rose following the early release of its second-quarter sales results, which beat expectations and led to an upgraded full-year outlook, driven by strong demand in the data centre market. Shares in Spanish financial services group, Bankinter performed well following the second-quarter results, underpinned by robust net interest income, supported by volumes and lower funding costs.
Our focus is on finding attractively valued companies with good prospects for cash generation and dividend growth over the longer term. On a rolling 12-month basis, the Trust recorded NAV and share price returns of 1.8% and 1.7% respectively, compared to the FTSE World Europe ex UK Total Return Index that returned 11.3%.
