Portfolio manager comments — Q2 2024
Fund performance was positive during Q2 and the fund rose 4.5% in SEK. The US stock market performed strongly in Q2, driven by the digitalization and generative AI themes. The large technology companies in particular posted strength and contributed significantly to the fund. In contrast, the US economy is showing signs of a slowdown, which led cyclical companies within consumption and industrials to lag during the quarter. The US central bank signaled that inflation is under reasonable control and the market is now pricing in a stabilization to interest rates, with rate cuts expected toward the end of 2024.
Fund returns benefited from the strong performance of Nvidia and Broadcom, which focus on the construction of the infrastructure related to the AI phenomenon. Holdings in Eli Lilly also posted strength after good news about their obesity drug. The fund also took the opportunity to increase its position in Apple at the beginning of the quarter, which contributed positively to returns. The rapid expansion of data centers means that the demand for energy will increase quickly, which is positive for shares in the energy company Nextera that posted strength in the period.
The fund significantly increased its exposure to the electrification theme with new holdings such as Nvent, Nextracker and Quanta Services.
The more cyclical companies, such as Pool Corp and Willscott Mobile Mini, lagged during Q2. Several of the software companies, such as Blackline and Veeva Systems, also posted weakness as a result of investment cutbacks by corporate customers.
The fund sold and purchased a number of companies. The most notable within healthcare included the sale of the pharmaceutical company Regeneron in favor of Vertex Pharma. Profit taking in Carrier, which manufactures air conditioners and heating pumps, as well as the sale of holdings in the software company Adobe were significant transactions.