Blackrock I&g Regulatory News (BRIG)

The information contained in this release was correct as at 31 July 2023. Information on the Company's up to date net asset values can be found on the London Stock Exchange website at:

https://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html.

BLACKROCK INCOME & GROWTH INVESTMENT TRUST PLC (LEI:5493003YBY59H9EJLJ16)

All information is at 31 July 2023 and unaudited.

Performance at month end with net income reinvested

BlackRock took over the investment management of the Company with effect from 1 April 2012.

At month end

Sterling:

Commenting on the markets, representing the Investment Manager noted:

Performance Overview:

The Company returned 2.0% during the month, underperforming the FTSE All-Share which returned 2.6%.

Market Summary:

Equity markets globally were mostly positive during July as falling inflation and encouraging GDP data around developed markets led to improving market sentiment.

Both the Federal Reserve (Fed)1 and European Central Bank (ECB)2 raised interest rates by the expected 25bps and hopes continued to mount that an end to monetary tightening is fast approaching.

In the UK, wage data remained high, but headline inflation fell more than expected to 7.9% and core inflation also fell bringing the number to 6.9%3.

In addition, an improved global economic outlook resulted in the positive performance of the industrial sector and commodity price recovery resulted in basic materials and energy sector performing well in the month. Other sectors such as Healthcare and Utilities underperformed in the month.

UK equities underperformed global developed markets, given the more challenging growth outlook. However, within the UK market, small and mid-caps outperformed, benefiting from the better-than-expected inflation numbers and strengthening sterling.

The FTSE All Share rose 2.62% during July with Basic Materials, Industrials and Financials as the top performing sectors while Health Care and Utilities underperformed.

Contributors to performance:

After a strong start to the year, the share prices of both Smith & Nephew and Oxford Instruments fell back during July; the companies were the top detractors from relative performance. Smith & Nephew experienced some building pressure on consensus estimates as a result of a slow China re-opening and rising cost pressures. Oxford Instruments was also impacted by a weaker dollar and building geological tensions. Shares in Reckitt Benckiser fell after the company reported a fall in volume performance.

As mentioned above, the month saw stronger performance in small and mid-caps; as a result, our holdings in Watches of Switzerland and Howden Joinery were top contributors to the relative performance of the Company. Standard Chartered also contributed to the Company's performance on the back of very strong H1 2023 results as well as a larger-than-expected share buyback program. The bank results highlighted good revenues in their wealth and markets business as well as improving growth in their end markets.

Changes:

During the period, we purchased a new holding in Intermediate Capital. Intermediate Capital has demonstrated the resilience of its business model while trading on an attractive valuation. Recent weakness in the share price has given us an opportunity to re-gain exposure here having sold it in the past at a higher valuation.

Outlook:

Inflation has consistently surprised in its depth and breadth, driven by resilient demand, supply chain constraints, and most importantly by rising wages in more recent data. Central banks across the developed world continue to unwind ten years of excess liquidity by tightening monetary policy desperate to prevent the entrenchment of higher inflation expectations. Meanwhile, March saw the first signs of financial stress with the bankruptcy of Silicon Valley Bank and Signature bank in the US serving to highlight the potential issues of the aggressive retrenchment of liquidity. Whilst the ramifications of this crisis remain unclear, it is likely that credit conditions and the availability of credit will continue to recede. This strengthens our belief that companies with robust balance sheets capable of funding their own growth will outperform. We are mindful of this and feel it is incredibly important to focus on companies with strong, competitive positions, at attractive valuations that can deliver in this environment

We would expect broader demand weakness into the second half of 2023 although the `scars' of supply chain disruption are likely to support parts of industrial capex demand as companies seek to enhance the resilience of their supply chains. A notable feature of our conversations with a wide range of corporates has been the ease with which they have been able to pass on cost increases and protect or even expand margins during 2022. We believe that as demand weakens and as the transitory inflationary pressures start to fade during 2023 (e.g. commodity prices, supply chain disruption) then pricing conversations will become more challenging despite pressure from wage inflation which may prove more persistent. While this does not bode well for margins in aggregate, we believe that 2023 will see greater differentiation as corporates' pricing power will come under intense scrutiny.

The UK's policy has somewhat diverged from the G7 in fiscal policy terms as the present government attempts to create stability after the severe reaction from the "mini budget". The challenging divergence in inflation between the UK and other developed markets has seen sterling recover some strength, notably against the dollar as markets infer higher rates for longer. Although the UK stock market retains a majority of internationally weighted revenues, the domestic facing companies have continued to be impacted by this backdrop, notably financials, housebuilders and property companies. The valuation of the UK market continues to be extremely low in absolute terms but particularly versus other developed market indices with many companies, notably the domestic earners trading at COVID or Brexit lows in share price or valuation terms. Although we anticipate further volatility ahead as earnings estimates moderate, we know that in the course of time, risk appetites will return and opportunities are emerging.

In China, the re-opening of the economy post the lockdowns has been slower than expected. There are early signs that the Chinese government is looking to stimulate the economy further which may become more apparent as we enter 2024. We continue to focus the portfolio on cash generative businesses with durable, competitive advantages boasting strong leadership as we believe these companies are best placed to drive returns over the long-term. We anticipate economic and market volatility will persist throughout the year and we are excited by the opportunities this will likely create by identifying those companies using this cycle to strengthen their long-term prospects as well as attractive turnarounds situations.

1Financial Times 26 July 2023 https://www.ft.com/content/110bd237-cbf2-463d-b1b5-edcb98245851

2Financial Times 27 July 2023 https://www.ft.com/content/440068b1-4c39-4ad9-94ee-2d54a1097fb2

3Reuters 19 July 2023 https://www.reuters.com/world/uk/uk-june-inflation-rate-lower-than-expected-79-2023-07-19/

18 August 2023