Fidelity European Trust PLC (LON:FEV) monthly factsheet for December 2025.
Portfolio Manager Commentary
Continental European equities rallied in December to end the year close to record levels, supported by a combination of factors including robust earnings growth, easing financial conditions, and improved policy support heading into 2026.
The Trust underperformed the index during the month. Stock picking within financials as well as the use of gearing detracted from returns. At the stock level, EssilorLuxottica declined following news that Google plans to launch AI-enabled glasses in 2026, potentially competing with EssilorLuxottica’s product developed and launched in partnership with Meta. The lack of exposure to UBS detracted from performance after Swiss lawmakers proposed a compromise on new capital rules aimed at keeping the bank internationally competitive. The top contributor was Inditex, whose share price rose after the company delivered strong quarterly results, beating expectations on both sales and margins. Roche also added value, extending last month’s strong momentum following positive results from two major drug trials in multiple sclerosis and breast cancer, transforming the long-term growth profile of the company.
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 16.2% and 21.1% respectively, compared to FTSE World Europe ex UK Total Return Index that returned 27.9%.
