LONDON (Alliance News) - TR European Growth Trust PLC said it had underperformed its benchmark for the half year to end-December.
It reported a total return, including dividends reinvested, on net asset value of 6.7%, compared to a total return from its benchmark of 8.2%. TR European Growth Trust's benchmark is the Euromoney Smaller Companies Index excluding UK.
The trust highlighted macro-economic issues such as the slowing Chinese economy, rising US interest rates, geopolitical tension and the collapsing oil price. This last issue the trust noted is "no bad thing" for the European economy, which is a net importer of energy.
The best performing stock in TR European Growth's portfolio was Dalata Hotel Group PLC, and it also saw good returns from Finnish online retailer Verkkokauppa.com Oyj. The biggest negative came from Swiss industrial OC Oerlikon Corp Pfaeffikon AG, hit by declining orders in its man-made fibre business, as well as Outotec Oyj and German bank Aareal Bank AG.
"Europe has been something of a bright spot in the global economy. We would hope that European equities should benefit from the action taken by the European Central Bank, the decline in the oil price and the generally weaker euro. We expect the weakness of the euro to be behind us given the relative strength of the European economy; as a reminder the portfolio is not hedged," said Chairman Audley Twiston-Davies in a statement.
Shares in TR European Growth were up 1.4% at 588.50 pence Monday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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Dalata Hotel Gp (DAL)