Fidelity Special Values PLC (LON:FSV) has published its monthly factsheet for September 2024.
Portfolio Manager Commentary
UK equities declined in September, underperforming major global indices against a backdrop of moderating domestic economic activity, uncertainty surrounding the implications of the upcoming UK autumn budget and a strengthening pound. This trend was exacerbated by a notable decline in oil prices causing energy stocks, which represent nearly one tenth of the UK market. Despite the initial downturn, a dovish pivot from central banks, and in particular a 50 basis-point rate cut from the US Federal Reserve (Fed), combined with stronger-than-expected US economic data and fresh stimulus measures from China, facilitated a partial recovery later in the month.
Despite their improved performance over recent years, UK equities still look cheap relative to other markets, and reasonable on an absolute basis. We believe that the combination of attractive valuations and the large divergence in performance between different parts of the market create good opportunities for attractive returns from UK stocks on a three-to-five-year view. Attractive valuations in the UK are being recognised by other market participants such as overseas corporates and private equity firms who have been amongst the biggest bidders in the UK market. Underlining this interest has been the sharp spike in M&A activity which remains a key feature in the Trust.
On a rolling 12-month basis, the Trust recorded NAV and share price returns of 18.6% and 19.5% respectively, compared to 13.4% for the index.
Fidelity Special Values PLC (LON:FSV) aims to seek out underappreciated companies primarily listed in the UK and is an actively managed contrarian Investment Trust that thrives on volatility and uncertainty.
