European Opportunities Trust PLC has published a new fact sheet, detailing portfolio holdings and past performance statistics as of the end of June. The MSCI Europe index was down 1.5% in sterling, while the company's NAV declined 2.0%. The fund had net borrowings of 54.1 million at the end of June, with a discount to NAV of 11.0% at month end.
The European Central Bank cut the deposit rate from 4.00% to 3.75% in June, revising inflation forecasts upwards. Elevated wage inflation, particularly in the eurozone, is a concern. The impending French general election caused French-German bond spreads to widen, impacting borrowing costs and stock performance. The company's portfolio addresses these developments, with exposure to AI solutions, companies with low debt and international revenue, and a play on the growing demand for LNG.
The biggest contribution in June came from Novo Nordisk, with increased marketing spend for its drugs in America and approval for its weight loss drug in China. The largest negative contributor was Grifols, which saw a credit rating downgrade from Moodys, despite the company's improving financial situation and stake sale in a Chinese company.
Trading activity in June was modest, with net borrowings remaining unchanged at 54.1 million. The company bought more shares in Ryanair, Genmab, CTS Eventim, and Oxford Instruments, funded by the sale of shares in Novo Nordisk. The outlook remains focused on the next reporting season, with confidence in the company's portfolio.
The company's investments are solely in European stock exchanges, with no exposure to Ukrainian or Russian securities. The ordinary shares of European Opportunities Trust PLC are traded on the London Stock Exchange. This communication is intended for investment professionals and is not for the use or benefit of other persons, including retail investors.