Investment Trusts

F&C Investment Trust - Market Snapshot January 2018

Equities posted strong returns over the month as investors embraced a goldilocks outlook with global growth broadening and gathering pace while inflation generally remains quiescent.
January 2018

Paul Niven

Managing Director, Portfolio Manager and Head of Portfolio Management, Multi Asset Solutions

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Risk Disclaimer 

Past performance is not a guide to future performance. The value of your investments can go down as well as up, and you may not get back what you originally invested.

 

Equities posted strong returns over the month as investors embraced a goldilocks outlook with global growth broadening and gathering pace while inflation generally remains quiescent.

The UK rallied strongly throughout December as Brexit divorce proceedings took a step forward and rising commodity prices helped mining and energy stocks. European equities posted reasonable returns through the first part of the month on the back of data releases showing further improvement in the health of the region’s economy.
 
However, concerns over the future political landscape in Germany, Spain and Italy led to a sell off into the year end. The European Central Bank was seen to be modestly less dovish on the back of updated economic growth and inflation forecasts. The USA market initially rallied after Trump’s tax reform bill made it through the Senate, however the Fed’s rate rise to 1.5% put a dampener on further movement. Equity markets still finished in positive territory, to cap a very strong year.
 
Looking into 2018 the fundamental backdrop seems supportive of further progress in equities. Nonetheless, given that market volatility has been so low and recent returns so strong it is not much of a stretch to suggest that gains may be harder fought from here as the year progresses. Valuations across asset classes are pushing into extended territory, suggesting that longer term gains may be more muted, but valuation alone has limited predictive content. With no fundamental pre-cursor to a bear market on the immediate horizon we remain constructive but expect that volatility will rise, drawdowns may become more frequent, and dispersion within markets will rise.
 
We continue to invest in a range of diversified underlying stock selected strategies and believe that we remain well placed to withstand any further short-term volatility in markets.

All information as at December 2017, unless stated otherwise

 

The Company is an investment trust and conducts its affairs so that its shares can be recommended by Financial Advisers to ordinary retail investors in accordance with the Financial Conduct Authority’s rules relating to non-mainstream investment products and intends to continue to do so.

 

The company is available for retail investors in the UK, professionally advised private clients and institutional investors who seek growth in capital and income from investment in global markets and who understand and are willing to accept the risks, and rewards, of exposure to equities.

 

Risk Disclaimer 

Past performance is not a guide to future performance. The value of your investments can go down as well as up, and you may not get back what you originally invested.

 

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