Fidelity European Trust PLC (LON:FEV) monthly factsheet for July 2026.
Portfolio Manager Commentary
Continental European equities edged lower in July, ending the positive momentum seen in recent months despite resilient corporate earnings. Geopolitical tensions and higher oil prices increased inflation concerns, while the European Central Bank left interest rates unchanged.
Against this backdrop, the Trust underperformed its index, mainly due to its overweight position in technology stocks. Stock selection in the basic materials and consumer discretionary sectors also detracted. The Trust’s geared exposure provided an additional headwind as markets weakened. Within technology, semiconductor-related stocks came under pressure as investors questioned the sustainability of AI-related spending and responded to growing competition from China. As a result, STMicroelectronics and ASML detracted from returns. In contrast, 3i Group advanced following a strong first-quarter update, with Action delivering double-digit sales and earnings growth, supported by strong cash generation and continued store expansion. TotalEnergies also contributed positively as geopolitical tensions supported oil prices and second-quarter results were broadly in line with expectations.
We remain focused on identifying attractively valued companies with strong prospects for long-term cash generation and dividend growth. Over the 12 months to 31 July 2026, the Trust’s NAV returned 11.6% and the share price returned 9.7%, compared with 21.2% from the FTSE World Europe ex UK Total Return Index.
Fidelity European Trust PLC (LON:FEV) aims to be the cornerstone long-term investment of choice for those seeking European exposure across market cycles.
