In May the Trust’s net asset value rose 4.0% (with debt at fair value), outperforming the FTSE All-Share which rose 1.2%. Following the drawdown in March, equity markets continued to be buoyed by hopes of a ceasefire in the Middle East, while from a UK domestic perspective there was some relief that April inflation data came in moderately below expectations, paring expectations for future interest rate increases. At the portfolio level the outperformance during May was, in large part, driven by holdings exposed to the substantial amounts of data centre spending in the US, such as fuel cell developer Ceres Power and power semiconductor producer Infineon Technologies. Aberdeen, the owner of consumer investing platform interactive investor, also performed well following encouraging results from listed peer AJ Bell, as well as reporting solid net flows from its own quarterly trading update in April. Among the weakest performers was food retailer Sainsbury following news of a potential government-imposed price cap on essential food items (that was subsequently rowed back on). During the month two new positions were purchased in the medtech sector – Convatec, listed in the UK, and Becton Dickinson, listed in the US. The medtech sector as a whole has performed poorly, meaning many shares are trading at lower than historic average valuations while end demand and company margins should prove robust. We also added further to the holding in commercial property owner Land Securities, which reported occupancy levels at a 20 year high and rents growing at their ‘fastest pace in nearly two decades’. These additions were partially funded by a sale of the holding in pork and poultry producer Cranswick, which was sold on valuation grounds.
