September, 2023
The Global Opportunities Fund declined in value but outperformed the MSCI AC World index over the month. Information technology was a top contributor for the fund alongside industrials and financials whilst energy, communication services, and health care lagged for the fund.
The top performing stocks in the portfolio were Relx, Progressive, 3I Group, UnitedHealth, and Dollarama. Online marketplace Dollarama saw its share price rise in September after the company posted Q2 profits that surpassed expectations and it boosted its same-store sales forecast for the year. Union Pacific, Home Depot, Danaher, and Thermo Fisher were among the detractors in September.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Fund-Hedged-Class-A-Monthly-Factsheet-SEP23.pdfAugust, 2023
The Global Opportunities fund outperformed the benchmark over the month.
Financials were a top contributor to the fund's relative performance alongside consumer discretionary and industrials, whilst health care and energy lagged.
The top performing stocks in the portfolio were Progressive, Danaher, Berkshire Hathaway and Mastercard. Progressive shares rose after Analysts said the company's month-to-month results showed improvements.
The biggest detractors in the portfolio included Texas instruments, UnitedHealth and American Express.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Fund-Hedged-Class-A-Monthly-Factsheet-AUG23.pdfJune, 2023
The Global Opportunities in Australia fund rose in value but underperformed the MSCI AC World index over the month.
The top performing stocks in the portfolio were Old Dominion Freight Line, Netease, Amphenol and American Express. Old Dominion Freight Line rose in June alongside other transportation names as the Dow Jones Transportation Average rose by double digits in June on the back of optimism about the US economy.
The biggest detractors for the portfolio in June were Kotak Mahindra Bank, Nestle and Samsung Electronics.
Kotak Mahindra Bank dropped the most in 12 months as traders took profits following the increase in it weighting in the MSCI indices. Kotak Mahindra Bank had performed well throughout April and May amid anticipation of this increase.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Fund-Hedged-Class-A-Monthly-Factsheet-JUN23.pdfMay, 2023
The Global Opportunities in Australia fund rose in value and outperformed the MSCI AC World index over the month.
3i Group was the best performing holding due to the fund being overweight relative to the benchmark. 3i shares have been gaining since March when it announced that its largest portfolio holding company (Action) had a great start to 2023 leading many analysts to suggest that 3i's portfolio is robust. Other strong performers that the fund included Samsung Electronics and Copart. Copart rose on news that the company had beat its revenue expectations and that the company had a positive outlook going forward.
As a result of investor optimism around AI and its potential, Nvidia was the biggest detractor, this was largely because the fund was underweight relative to the benchmark. The stock performed extremely strongly on the back of good quarterly results and upgraded medium term profit guidance. Other detractors included Nestle, EOG Resources and Berkley Group. Nestle shares declined after the surprise departure of CFO Francois-Xavier which left investors 'disappointed' given the fact that Roger had built an 'effective partnership' with Nestle CEO Mark Schneider.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Fund-Hedged-Class-A-Monthly-Factsheet-MAY23.pdfApril, 2023
The Global Opportunities in Australia fund rose in value and outperformed the MSCI AC World index over the month on unhedged basis.
Kotak Mahindra Bank was the best performing holding on a relative basis, supported by a combination of good 4Q22 results and the broader rally in Indian stocks. Other strong performers included Berkshire Hathaway and Nestle. Berkshire was boosted by the release of strong earnings from some of its key underlying holdings. Similarly, Nestle's Q1 results were better than consensus estimates and surprised on the upside. Elsewhere, not owning Tesla was also highly favourable to relative performance as the stock fell sharply following further price cuts to its EV models.
At the other end, Texas Instruments was one of the most notable detractors. The company's Q1 results were mostly in line with estimates but the forward guidance was slightly below consensus expectations which saw the share price come under pressure.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Factsheet-APR23.pdfMarch, 2023
The Global Opportunities fund in Australia outperformed the MSCI AC World index over the month.
From a geographic perspective, the US was the fund's biggest driver of relative performance, led by Microsoft and Texas Instruments which rose as part of the broader rally in tech stocks.
China was also a strong area for the fund where NetEase was a key contributor. The stock was boosted by an analyst upgrade and strong China PMI data. The latter of which also supported stocks such as Tencent. The UK was also a bright spot for the fund, with Relx and 3i being the main drivers.
Sector-wise, relative gains were driven by financials and information technology, while consumer staples also performed well. Moderate weakness came from the fund's health care names as defensives lagged the broader market rally in what was largely a 'risk on' month.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Factsheet-MAR23.pdfJanuary, 2023
The Global Opportunities in Australia fund rose in value and outperformed the MSCI AC World index over the month.
From a geographic perspective, Asia Pacific was the biggest area of strength for the fund. China was the key contributor, as our gaming and internet holdings NetEase and Tencent took support from the easing regulatory environment. Our US holdings also aided relative performance, led by American Express and Nvidia. AmEx notably advanced after reporting strong 4Q earnings and an optimistic 2023 forecast, while the semiconductor manufacturer was buoyed by a broader chip rally. 3i, the London-based private equity company, was behind the strength in the fund's UK holdings, following a significant 3Q earnings beat.
Sector-wise, healthcare was the fund's biggest contributor to relative gains this was down to our significant underweight in what was the market's weakest absolute performer over the month. Industrials closely followed, in particular driven by Ryanair after the airline operator boosted its full-year profit forecast following strongerthan-expect demand over Christmas. The consumer staples name, L'Or al, jumped amid a broader rally of France's luxury stocks on softer-than-expected inflation and China optimism. However, further gains were held back by our underweight consumer discretionary which outperformed in January, and our materials names modestly lagged.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Report-R-1.pdfDecember, 2022
The Global Opportunities Fund in Australia fell in value but outperformed the MSCI AC World index over the month.
From a geographic perspective, most relative gains came from the portfolio's heavyweight, the US. The largest contributor was not owning Tesla, whose share price fell further on a report of plans to temporarily halt production at its China factory, rekindling fears around demand risks. Our smaller holding in Apple relative to the benchmark was also a bright spot, as supply chain and demand issues worried investors. The fund's overweight in the UK also buoyed performance, with 3i Group, the London-based private equity company, the key contributor. After a strong month, having no exposure to Japanese equities was the fund's main detraction to performance.
Strong stock selection namely the omission of Tesla from the portfolio drove the outperformance of the fund's consumer discretionary sector. The two Chinese gaming companies, Tencent and NetEase, were behind the strength in our communication services holdings, both rallying amid Beijing's latest monthly game approvals and new regulatory shift. Our underweight in health care dragged on relative gains, however.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Factsheet-DEC22.pdfNovember, 2022
The Global Opportunities in Australia fund rose in value and outperformed the MSCI AC World index over the month.
From a geographic perspective, the US drove most of the fund's outperformance. Our underweight in Apple relative to the benchmark was the top contributor, as the tech giant slid in value amid continued Covid-driven lockdowns around the largest iPhone production factory in China. The omission of Tesla from the portfolio also benefitted, with Elon Musk's company facing a dip in its share price as the Twitter turmoil continues to impact the EV maker, and Wedbush removed the stock from its well-recognised best stock ideas list. The prospect of lower rate hikes from the Fed buoyed Nvidia's share price, and the semiconductor manufacturer also benefitted from easing US-China tensions, as well as improving sentiment after Warren Buffet invested c.$5bn in Taiwanese chipmaker, TSMC. Our French and Chinese holdings were also a bright spot, with cosmetic manufacturer L'Or al participating in a broader rally of European luxury stocks, spurred on by China's said plan to end their system of penalising airlines for bringing virus cases into the country.
The fund's information technology holdings led gains, with Apple the main driver, followed by the communications services sector as Tencent and NetEase participated in the broader rally in Chinese equities on reopening hopes. Our energy stocks did well too, with Total Energies in particular benefitting from a broader rally in oil names as crude advanced after Saudi Arabia denied a report stating that it is discussing increasing the oil production for the OPEC+. Our underweight in materials the sector with the highest absolute returns in both the portfolio and the benchmark was an area of weakness however
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Factsheet-R-NOV22.pdfOctober, 2022
The Global Opportunities in Australia fund rose in value but underperformed the MSCI AC World index over the month.
From a geographic perspective, most of the fund’s weakness came from our US holdings. Despite its 3Q earnings beating estimates, Danaher, along with other life-science tools makers, dropped on bioprocessing demand normalising as Covid recedes. Danaher, along with Swiss pharmaceutical Roche, dragged on the fund’s health care holdings. First Republic Bank also lost value after announcing that its 2022 net interest margin (NIM) is expected to be at the lower end of their guidance range. In line with other large, US technology stocks, Amazon and Microsoft also detracted from performance on disappointing 3Q corporate earnings results as revenues slowed. Having said this, the fund’s information technology stocks overall did well relative to the benchmark thanks to strong stock selection, with Mastercard a notable contributor after an earnings beat. Chinese gaming companies, NetEase and Tencent, underperformed amid a global mobile-game sales slowdown and Chinese market weakness. Both drove underperformance in our communication services holdings, our weakest sector over the month.
The fund’s UK stocks did well however, with Relx and 3i the two strongest performers, as did stock selection in South Korea. Our underweight position to Japan was additive to performance. JP Morgan was the fund’s top performer, as the investment bank rebounded after reporting better-than-expected earnings and boosting its annual NII (net interest income) guidance. The consumer discretionary sector was also an area of modest strength, largely due to the omission of Tesla from the portfolio.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Report-R.pdfSeptember, 2022
Both the hedged and unhedged Global Opportunities funds fell in value and underperformed their benchmark during the month of September.
From a geographic perspective, most detraction came for our US stocks, with our technology names particularly impacted by continued hawkish Fed rhetoric. Adobe fell as investors deemed their purchase of design platform Figma as too expensive, while NVIDIA faced the continued headwind of limited exports to China imposed by the US, although the company obtained licenses to export some chips to China-based US customers. Some Chinese stocks also detracted from performance, namely the US-listed companies Tencent and NetEase which were dragged down by waning risk appetite and tensions between Beijing and Taiwan both also held back the fund's performance in the communication services sector. Our UK holdings also struggled against broader headwinds of continued growth fears and concerns around the government's new fiscal package.
Our industrials holdings were relatively weak, such as Ryanair which lost ground amid staff strikes and flight disruptions. Not holding any real estate or utilities companies in the portfolio buoyed relative gains, as both sectors underperformed the broader market. While our underweight in healthcare was an area of weakness, the two stocks we do own in the sector, Roche and Danaher, were the fund's top performers. Notably, Roche's share price rose on positive news flow around a successful Alzheimer's drug trial by industry peers.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Factsheet-R-SEP22.pdfAugust, 2022
In August, the Global Opportunities Fund fell in value, on both a hedged and unhedged basis, and underperformed the MSCI AC World index.
From a geographic perspective, key detraction came from our US stocks. The Fed's hawkish signal led to a sell-off in major US technology stocks, including Apple and Nvidia, two key underperformers in the fund. Idiosyncratic risk also contributed: Apple faced reports of a possible antitrust case filed by the Department of Justice. Meanwhile Nvidia, the second-largest semiconductor company in the US, slid after cutting its quarterly revenue forecast due to a weaker outlook in the gaming industry, and dropped at the end of the month on news of the US limiting exports to China on fears of military end-use. Some weakness also came from our UK holdings such as Berkeley Group: the residential and commercial property development company gave back gains as inflation data fuelled concerns about rising mortgage rates weighing on property demand. Stock selection in Europe (ex UK) was an area of strength for the fund however, with the likes of Ryanair and TotalEnergies outperforming.
The Fed's hawkish indication of more interest rate rises issued at the Jackson Hole meeting troubled large technology stocks, sending the fund's information technology stocks lower. Housing durables of the consumer discretionary sector also detracted, largely down to Berkeley Group and Installed Building Products. The communications services sector was our strongest, with the Chinese companies Tencent and NetEase outperforming on news of 1 trillion yuan of additional economic stimulus from the Chinese government.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Factsheet-R-AUG22.pdfJuly, 2022
The Global Opportunities fund outperformed its benchmark on both a hedged and unhedged basis over the month.
From a geographic perspective, our US stocks led relative gains, led by Amazon whose share price rose following strong 2Q earnings results and an upbeat forecast, producing its biggest one-month percentage gain since 2015. The electrical components manufacturer, Amphenol, and life science and diagnostics manufacturer Danaher similarly rallied after positive results and outlook. The fund's UK stocks also demonstrated strength, as Berkeley Group, the residential and commercial property development company, and 3i, the private equity firm, both rose on the back of better-than-expected results. Meanwhile, Asia Pacific ex Japan disappointed, as names such as Tencent came under pressure on fresh uncertainties regarding their US listing status.
Sector-wise, our overweight in information technology was a positive, as was stock selection, led by the aforementioned Amphenol. Some favourable stock performances from the likes of Amazon and Installed Building Products in the consumer discretionary sector also buoyed relative gains. On the flip side, Tencent held back performance in the communication services sector, as did TotalEnergies, the French integrated oils company, in the energy sector as oil prices corrected downwards.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Report-R-JUL22.pdfJune, 2022
Global equity markets retreated in June. Rising inflation, interest rate hikes in response to rising inflation, and slowing global growth all weighed on investor sentiment. US equities slipped further, as the US Federal Reserve made its most aggressive rate rise since 1994, increasing their base rate by 0.75%, and heightening recession risks. It was a similar story for the UK equity market, as the Bank of England raised rates by 0.25%, a more cautious hike relative to other central banks despite UK annualised inflation hitting 9.1%, a 40-year high.
The Eurozone followed suit, with inflation data coming in higher than consensus estimates, and the ECB announced plans to withdraw stimulus and start raising interest rates. Asian equity markets retreated, pulled down by the rising rate environment as inflation persisted, although Chinese equities advanced on re-opening expectations and positive macroeconomic activity. Emerging markets also slipped, however they outperformed the development markets. A rise in US recession fears caused equities in commodity-driven markets to price in lower commodity prices and subsequently drop; as a result, Latin America finished with the worst performance.
File:May, 2022
In the US, equities fractionally advanced, however the NASDAQ composite retreated as the market continued to experience a rotation away from high-growth tech names. The FOMC raised its federal funds rate by 0.5%, the biggest increase in two decades, although inflation registered lower than the previous month for the first time in eight months. The UK equity market closed modestly higher amid concerns around slowing growth and high inflation as the "cost of living crisis" continued to impact UK households. The Bank of England raised interest rates to 1%, its highest level since February 2009, and warned that the UK could suffer a recession later this year. European shares ended lower in May as rising inflation, the prospect of interest rate hikes, and slowing growth all dampened investor sentiment. Eurozone inflation hit a record 8.1 per cent in the year to May, setting a new high and putting further pressure on the European Central Bank (ECB) to tighten monetary policy. Equities in Asia marginally advanced, with relief taken from China ending its three-month losing streak thanks to improving market sentiment which included government economic support efforts, an improving COVID situation and the possibility of Biden removing some of the tariffs on Chinese imports.
File:April, 2022
Global equity markets fell in April as uncertainties surrounding the Russia-Ukraine conflict persisted, supply chain constraints, inflation and interest rate rises weighed on investor sentiment. In the US, all three major indices fell in value, with market confidence stunted ahead of big tech corporate earnings reports against a backdrop of rising consumer prices and rising bond yields. The UK equity market closed marginally higher, primarily due to market composition which has more exposure to better performing energy and mining stocks. UK inflation hit a fresh 30-year high of 7%, which added pressure on the Bank of England to further increase interest rates, despite the dampened growth outlook. In similar fashion, Asian equity markets declined over the month, with sentiment dampened by the lockdowns imposed by China as a result of fresh clusters of COVID-19 cases, a rising global interest rate environment, and slowing economic growth.
File:March, 2022
Contributors to performance The Global Opportunities fund rose in value on a hedged basis, but declined on an unhedged basis, both modestly underperforming the MSCI AC World index over the month.
From a geographic perspective, the fund's Asia Pacific ex Japan holdings were particularly weak, followed by the UK. With regards to Asia, this predominantly came down to some unfavourable stock selection (e.g. Alibaba) and being overweight in China, as well as the fund's exclusion from Australia, whose equity market has recently benefitted strongly from rising commodity prices. Unfavourable stock selection caused a lag in our UK holdings, such as Berkeley Group whose shares have been hit by an industry-wide adverse political development over remediation of previously constructed homes with the use of certain cladding materials. We are of the view that Berkeley's record of high-quality construction and prudent provisioning should leave the business well positioned to manage the necessary remediations.
Sector-wise, the consumer discretionary sector was the biggest area of weakness, followed by the communication services sector, both weakened by stock selection. Installed Buildings Products and Tencent were the biggest detractors of each respective sector, the former impacted by rising mortgage rates and input costs, while the latter underperformed as investors offloaded shares amid concerns over Beijing's ties with Russia, and sentiment was dampened after the tech giant received a record fine after its WeChat Pay was found to have violated anti-money laundering rules. Financials were a bright spot for the fund however, with Progressive and Markel the two strongest stocks. Having said that, the fund's best performer was Canadian Pacific Railway, whose share price strengthened as investors increasingly turned to defensives as the latest developments in the Russia/Ukraine conflict drove risk-off sentiment, and a new stake worth circa US $1.2 billion helped rally investor interest.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Report-MAR22.pdfJanuary, 2022
Global markets were weak in January amidst a backdrop of rising inflation and Federal Reserve and other central banks talk of tightening in response to inflation. From a style perspective, growth stocks (such as information technology) underperformed the most against a backdrop of rising bond yields. On the flip side, cyclical and so-called value sectors (such as energy and banks) fared the best. Equity markets fell significantly as the Fed reaffirmed its tightening stance, with Chair Jerome Powell touching on the possibility of interest rate raises occurring at every Federal Open Market Committee (FOMC) meeting, of which there are seven in 2022. Sentiment also waned as tensions between Russia and the US escalated, with the threat of an invasion into Ukraine seeming more likely despite negotiation efforts.
File:December, 2021
Global equity markets went up in December, as initial fears about the new COVID-19 variant, Omicron, and its increased transmissibility, were alleviated once further research confirmed that it was less severe than the once-dominant Delta strain. The fight against inflation took a decisive turn as the Bank of England raised interest rates for the first time in three years, despite the rapid spread of Omicron, and the US Federal Reserve announced plans to wind-down its programme of bond purchases at a faster pace, paving the way for higher US interest rates in 2022. The pound sterling dropped to its lowest level in a year against the dollar as restrictions implemented to tackle rising Omicron cases clouded the UK economy; nonetheless, the UK equity market advanced over the course of December. European shares also ended higher on the hopes that further restrictions to fight the new COVID variant seemed unlikely given the low hospitalisation rate. The European Central Bank said that its EUR 1.85 trillion Pandemic Emergency Purchase Programme would reduce net purchases this year and halt them altogether in March. US equity markets advanced strongly despite Omicron concerns, with US jobs and inflation data painting a mixed picture. The labour market remained healthy, although fewer than expected new jobs were created, and core inflation increased to 4.9% year-on-year, its highest since 1991. Asian equity markets were up, but gains were muted relative to Europe and the US as performance was dragged down by China, whose equity markets lagged amid mixed economic data and clusters of COVID-19 cases. Global emerging equity markets posted positive monthly returns, but underperformed relative to the developed markets. All emerging regions posted gains, led by Latin America, and followed by EMEA and Asia.
File:November, 2021
Global equity markets fell modestly in November, as gains made at the start of the month - following a strong earnings season - were offset by news of the Omicron variant of COVID-19 toward the end of the month. Investor sentiment was dampened as the emergence of a new variant of the virus was detected in southern Africa, with markets pricing in the possibility of renewed travel bans and restrictions, as well as a slowdown in economic recovery. The Federal Reserve’s Chair, Jerome Powell, showed a less accommodative attitude to quantitative easing (more aggressive on tapering) as he spoke to Congress, which concerned Asian markets too. EM markets faced a similar story, with Latin America the largest underperformer as almost all currencies depreciated against the dollar. European markets also saw falls as COVID-19 cases increased, and the Omicron variant led to worries about economic growth as the region saw the reintroduction of restrictions, varying from the closure of all non-essential shops during certain hours to full-scale lockdowns in Austria and Slovakia. Similarly, in the UK, airlines and travel firms were hit hardest as concerns around new restrictions mounted after 10 southern African countries were added to the red list.
File:October, 2021
Global equity markets on the whole strengthened over the course of October, recovering most of the losses suffered in September. The UK equity market ended higher as the UK economy gained momentum with positive data pushing stocks higher, despite continued supply and staff shortages. European bourses followed a similar trend, with the bloc on track to regain its pre-pandemic level of output later this year. Most Asian equity markets rose, albeit regional indices underperformed the broader gains of developed markets, as earlier strength was undone by US-China tension and stagflation concerns. Emerging market equity markets posted positive returns over the month, although returns similarly lagged those from the developed world. EM EMEA posted the strongest performance, followed by EM Asia, while EM Latin America lagged behind as the only region to register negative returns. US equities performed strongly over the month, with the S&P 500 and the Dow Jones hitting record highs. Markets took support from a positive start to the US earnings reporting season, good jobless claims numbers and declining COVID-19 cases.
File:September, 2021
Global Equity returns were negative over the month, as a result of the pressures from a global energy crisis, supply chain disruptions and a slowdown in China’s economy. US equity markets slipped, as the Federal Reserve continued to back their tapering timeline amid an increase in inflation forecasts. Asia also faced the ongoing threat of regulatory crackdown in China affecting a number of sectors, largely created by China’s imposed power shortages and a weakened property sector, combined with sporadic virus outbreaks. Emerging markets followed suit, although energy-driven markets like Russia’s fared better. The UK equity market similarly ended lower as economic growth showed signs of slowing as businesses came under pressure from global supply chain disruption and staff shortages. Events in China, discussions around central bank tightening monetary policy and continued supply issues also weighed on European stocks.
File:August, 2021
US equity markets were up over the course of August, with the S&P 500 index gaining 3%, buoyed by the positive July job data pointing towards a continuing economic recovery. Powell, chair of the US Federal Reserve, reassured investors of a longer period of loose liquidity and a very gradual tapering process to come, which helped strengthen global markets in the latter half of the month. Asian markets also posted gains in a context of favourable economic data and upbeat earnings reports, despite the flat performance of Chinese equities due to an imposed lockdown and continued regulatory tightening. Emerging markets outperformed the world as the EMEA region and south Asia performed strongly. UK equity markets ended higher, however showed signs of slowing down as global supply chain disruption and staff shortages left businesses under pressure. Similarly, European markets saw further gains with the percentage of European companies beating analysts’ earnings estimates hitting a 5-year high.
File:July, 2021
US equity markets were the strongest performers over the course of July, with the S&P 500 index rallying for the sixth month in a row despite concerns over the COVID-19 Delta variant. Asian markets finished down after tightening Chinese regulations on the internet, healthcare, property and education industries impacted consumer confidence, with share prices giving back most of their year-to-date gains. Emerging markets underperformed the developed markets, also feeling the shockwaves of China’s regulatory activity and struggling to deal with the rise of the COVID-19 Delta variant. Europe and the UK, which boast more developed vaccination programmes, were not as affected by COVID-19 worries, both showing modest gains over the month.
File:June, 2021
Despite the US Federal Reserve signalling that interest rates could be hiked in 2023, the S&P 500 rallied for the fifth straight month, supported by the announcement of Joe Biden’s trillion-dollar infrastructure plan. Asia markets lagged, notably China, which suffered an uptick in new COVID-19 cases. Emerging Markets followed suit after underperformance of their currencies, however commodity-orientated markets rallied. June saw further gains in European markets, as strong economic data such as a rise in the Eurozone’s Composite PMI to 59.2, its highest level since June 2006, showed further signs of strong rebounding. UK markets were also flat as the Delta variant weighed heavily on investor confidence.
File:May, 2021
Europe, UK and US equity markets continued to gain ground with the S&P500 index rallying for the fourth straight month, the longest run since August 2020, on the back of strong economic data. Asia markets also generated positive returns, even despite the increasing transmissibility of new COVID-19 virus strains and low vaccination rates. Emerging Markets also benefitted from the strengthening of global equity markets, with the Latin America region rallying strongly.
File:April, 2021
European and US markets were up in April, as optimism surrounding reopenings and lockdown endings boosted market sentiment. PMI data suggested that the manufacturing and services sectors are strengthening on the back of President Biden’s USD $1.9tn fiscal stimulus. Asia recovered their losses of previous months, headlined by China’s 18.3% GDP growth in the first quarter.
File:March, 2021
Global equities advanced higher in March, drawing support from an acceleration in the vaccination campaign and continuing fiscal aid. US stocks led the gains, closely followed by Europe. Performance in Asia however was held back by weakness in mainland Chinese internet stocks. With optimism about the global recovery increasing, value and economically sensitive stocks outperformed growth.
After finally signing the US$1.9 trillion relief package bill into law, President Joe Biden unveiled a US$2 trillion plan targeted at overhauling and upgrading US infrastructure as well as hastening a shift to new, cleaner energy sources.
File:February, 2021
Encouraged by increasing confidence over global growth prospects amid a steady, albeit geographically uneven, rollout of the COVID-19 vaccine, equity markets advanced higher. Positive sentiment was also enhanced by the prospect of a US$1.9 trillion US fiscal package that could provide millions of Americans with payment cheques for US$1,400. Although the deal successfully passed through the Democratically controlled House it still needs to get approval from an evenly divided Senate.
Trading was more cautious towards the end of the month, however, as inflation worries unnerved markets. However, concerns that rising price pressures could prompt the US Federal Reserve (Fed) to hike US interest rates sooner than had previously been expected were pushed back by dovish words from Fed Chairman Powell.
File:December, 2020
Global equity markets advanced higher in December on optimism over the global roll out of the Pfizer-BioNTech vaccine. Growing confidence about the prospects for the US economy were also given a shot in the arm after President Trump finally agreed a US$900 billion stimulus bill after initially refusing to sign it. In Europe the UK and EU finally reached a post-Brexit trade agreement after months of fraught negotiations.
File:November, 2020
Our focus is on 'bottom-up' industry and company level research because this is where we see our greatest source of competitive advantage. However, we believe it unrealistic to think the macroeconomic landscape can be ignored when it comes to portfolio construction and risk management. We believe the current set-up is quite extreme, so we have devoted a good amount of time to trying to understand the range of possible outcomes and what it means for portfolio outcomes.
Our research has been focussed on delineating those businesses which we deem to be temporarily impacted versus those that could be permanently impaired by changing habits. Idiosyncratic risk continues to account for over half of tracking error, a result of our continuing efforts to make sure that our stock picking is the dominant determinant of our returns. Our tolerance for balance sheet leverage remains low with most of the top 20 holdings boasting net cash balance sheets.
In terms of portfolio positioning we maintain a pro-cyclical bias because we see an abundance of opportunities to own good companies at attractive prices in areas of the market that have been most impacted by the virus. We continue to hold a number of positions in the banking sector and in recent times have gradually increased our exposure to consumer discretionary stocks as we see a variety of opportunities to buy good companies at attractive prices.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Australian-Share-Fund-Monthly-Report-R-Class-A-NOV20.pdfOctober, 2020
It seems that the odds of a resurgence in inflation are priced very cheaply today. Macroeconomic forecasting doesn’t play a role in our stock selection process, but we have an eye to this context when constructing the portfolio and managing risk. A more inflationary backdrop could have important implications for the leadership within the market and it is something we are paying increasing attention to. We think the current backdrop has been a helpful tailwind to some of our holdings in technology and staples, for example, and any trend reversal could present an unhelpful headwind to those holdings.
At the other end of the spectrum, banks, energy and airlines have suffered significant relative and absolute declines. However, it seems reasonable to us that the most advantaged businesses in these industries, with the strongest balance sheets, run by astute managers, will ultimately recover lost earnings power. In some cases, they may even end up with larger shares of the industry profit pool. We believe Ryanair is one such example.
At a portfolio level we have selectively added to holdings that are more impacted by current events because recent share price weakness has made their prospective returns more attractive. At the other end we have reduced holdings where we feel that both sentiment and lower bond yields have caused valuations of our ‘Covid winners’ to reach uncomfortable levels.
File: https://commentary.quantreports.net/wp-content/uploads/2020/12/Invesco-Wholesale-Global-Opportunities-Funds-Monthly-Report-R-OCT20-unlocked.pdfticker: GTU0008AU
commentary_block: Array
factsheet_url:
Related Feature & Literature ==> Download Fund Literature.
In the PDF file => grab “Contributors to Performance” section.
To unlock the PDF use this link:
release_schedule: Monthly
fund_features:
Invesco Wholesale Global Opportunities Fund aims to provide long-term capital growth through a portfolio of global equities. The Fund invests in global equity securities listed in developed or developing markets that generally have a minimum market capitalisation of US $1 billion.
- Active and research driven investment approach.
- The underlying portfolio generally holds between 30 and 50 stocks.
- Look to identify significantly undervalued companies, companies with attractive valuations, strong franchises and management that is focused on disciplined capital allocation.
- It is permitted to borrow and to grant security over its assets, and it is primarily invests in global shares.
manager_contact_details: Array
asset_class: Foreign Equity
asset_category: Currency Hedged
peer_benchmark: Foreign Equity - Currency Hedged Index
broad_market_index: Developed -World Index
structure: Managed Fund