QuotedData’s morning briefing 17 June 2020

  • The anti-inflammatory drug, Dexamethasone, has been shown to help the most seriously ill covid-19 patients.
  • Private equity sector company, ICG Enterprise (ICGT), delivered an NAV total return of (4.1%) and a portfolio return of (3.8%), over the quarter to end-April. It expects the impact from covid-19 to  continue weighing on valuations over the coming months. The portfolio’s main sector allocations are: healthcare and education (24%), business services (14%) and technology (15%),industrials (15%) and consumer (16%). ICGT has limited exposure to energy and financials.
  • UK small and mid-cap fund, Henderson Opportunities (HOT) reported interim results to end-April. NAV was down (19.7%) over the period on a total-return basis, with the sharp decline reflecting its exposure to the collapse in economic activity across the UK. This can be seen in the stock level detractors from performance financial year to date, which include retail property owner Hammerson, UK building materials company Sigmaroc and Scottish housebuilder Springfield Properties. HOT noted that at a time when large parts of the domestic economy have effectively been mothballed as a result of the Covid-19 (for example Scottish housebuilding has stopped entirely) this will naturally have an impact on the earnings of the companies affected. Managers, James Henderson and Laura Foll, had this to say: “The severity of the slowdown in economic activity and the level of commitment to spending by government to alleviate some of the disruption is on an unprecedented scale for peacetime. The old economic models of how the economy should respond to events are of little help in predicting what will happen. In time the virus will wane, and economic activity will recover. The shape of the recovery will result in an economy that will be different to the past. Greater flexibility in work practices and large advances in the digital space will be evident, but so will higher debt levels and inflation may be higher than in the recent past. For the equity investor there will be multiple opportunities and pitfalls. This portfolio has the scope to be responsive to the changing investment landscape and hold companies that will succeed in moving forward in this changed world.”

We also have news of a manager change at JPMorgan Indian, e-commerce and tech serving Monks well and Aberdeen Japan discussing the relatively milder outbreak of covid-19 in the country.

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