Portfolio manager comments — Q2 2024
Performance in EMEA was strong during the quarter with an upturn of just over 4%, while the fund posted even greater strength and rose just over 7% in SEK.
The strongest markets were South Africa as well as Turkey, in which the economy continues to recover with declining inflation from very high levels. Several of the fund’s strongest contributors are also Turkish companies within the population growth with increased consumption theme such as the food chain BIM and the mobile operator Turkcell, which both rose just over 45%. However, the strongest performer was the clothing chain Mavi, which rose 70%. South Africa rose after the sitting president Ramaphosa retained his post after the parliamentary election. Although ANC lost its majority, they built a broad coalition with several parties, with DA as the most important, and also received several minister positions in the government. The market saw a broad upturn within all of the themes in which the fund has exposure.
Kuwait and Egypt were the weakest performers due to uncertainty about the results of reforms, which led to a decrease in the fund’s exposure to these countries. We decreased the fund’s holdings in TBC Bank in Georgia as a result of political uncertainty and a fragmented political direction. Despite this, growth in the country remains strong and we are carefully following developments. Several countries in the region also continued to cut interest rates and we expect several additional cuts during the autumn, which are intended to stimulate further growth during the full-year 2024.