June 2024: Interest rates and politics prevail
June was a month with very little corporate news, and that means that in the stock market we have to rely mostly on macroeconomic data. The long-awaited first rate cut in Europe is a fact, but follow-up steps by the ECB are uncertain. The realization dawns that we have a long way to go before we can speak of low interest rates again. The sudden parliamentary elections in France caused interest rates to rise in bond markets and turmoil in stock markets. All in all, this resulted in a return for European large caps of -1.0% on average. Mid-caps and small caps struggled even more, posting returns of -2.7% and -3.3%, respectively. Investors in the Sustainable Dividends Value Fund saw the value of their investment fall by 2.7%. Over the past quarter, our fund’s return was +3.1% and +5.5% since the start of the year. We see that some companies have since revised upwards their initially cautious expectations for 2024. We expect that the growing optimism among the management of these companies, will lead to an improvement in corporate results during the year. Since launching in 2016, we have now achieved over 65% returns.
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The fund
Sustainable Dividends offers an investment fund that invests in a well-diversified portfolio of European companies at the forefront of the sustainability transition. Our focus is on a disciplined investment process, while applying both qualitative and quantitative financial criteria.