LONDON (Alliance News) - Perpetual Income & Growth Investment Trust PLC on Monday said it outperformed its benchmark in the year ended March 31, having positioned its portfolio to protect from market volatility.
The trust said its net asset value total return came in flat for its financial year, compared to the 3.9% fall in its benchmark, the FTSE All-Share Index.
Perpetual Income & Growth Investment Trust said its return "should be viewed in the context of the significant market volatility created by sustained political and economic uncertainty during the year".
"Stock market sentiment over this 12 month period was largely driven by concerns over a slowing Chinese economy and the global economic outlook, the actions of central banks and movements in commodity prices," said the trust's Portfolio Manager Mark Barnett.
"The start of the period saw the equity market rise strongly, driven by the introduction of quantitative easing in the Eurozone and further stimulus from Japan. However, market sentiment swung sharply negative on growing concerns over the impact of the strengthening US dollar on emerging market debt and the deflationary impact of a possible devaluation of the Chinese Yuan," Barnett said.
"The near term outlook for the UK stock market is likely to remain clouded by a muted macro-economic backdrop in the global economy and increased pressure on profitability in the corporate sector," the portfolio manager added.
"The overall implications for the UK stock market, which is highly global in its make-up, are that earnings growth in many sectors may disappoint. Given that valuations are not obviously cheap, overall returns from equities may be expected to be subdued for the time being. The volatility witnessed since the start of 2016, partly caused by nervousness over financial stability in China, is also likely to remain a feature of the investment landscape for the remainder of the year," Barnett said.
Shares in Perpetual Income & Growth Investment Trust closed up 1.3% at 380.90p on Monday.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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