Gold Shines whilst Technology continues to perform: Willis Owen reveals the best & worst sectors and funds in July 2019
- US and Technology rally extends into July
- Gold funds top performance tables
- UK Smaller companies disappoint as Brexit Uncertainty weighs
Adrian Lowcock, Head of Personal Investing, Willis Owen says:
“July is usually a fairly quite month for markets as investors are more focused on summer holidays and enjoying their summer. Leading into the summer it looked like we could be in for a typical sell-off as sentiment was gloomy and significant headwinds faced the global economy.
However an agreement between China and the US to restart trade negotiations, big changes in direction from the Fed on interest rates along with the fact that global economic data, whilst having weakened, remains positive. As a result the US and Technology sectors lead markets higher.
However doubts around the direction of the global economy continued to weigh on investors and as a result gold was in demand helping to drive up the price of gold miners as well with MFM Junior Gold leading the way. Gold has languished for some time and been out of favour amongst investors but will look more attractive in a low interest rate environment with investors returning to the precious metal.
10 best-performing sectors
|
Investment Association Sector |
Percentage |
|
Technology & Telecommunications |
7.97 |
|
North American Smaller Companies |
7.39 |
|
North America |
7.14 |
|
Japanese Smaller Companies |
6.33 |
|
Global |
5.3 |
|
Global Emerging Markets Bond |
4.67 |
|
Japan |
4.38 |
|
Global Equity Income |
4.18 |
|
China/Greater China |
4.17 |
|
Asia Pacific Including Japan |
3.92 |
Source: FE Analytics, performance from 30th June to 31st July 2019 in pounds sterling on a total return basis
10 best-performing funds
|
Funds |
Percentage |
|
MFM Junior Gold |
22.04 |
|
HC Charteris Gold & Precious Metals |
20.05 |
|
Merian Gold And Silver |
15.79 |
|
Investec Global Gold |
15.44 |
|
LF Ruffer Gold |
14.67 |
|
Smith & Williamson Global Gold & Resources |
13.09 |
|
Thesis Bryth |
12.23 |
|
BlackRock Gold & General |
11.97 |
|
Quilter Investors Precious Metals Equity |
11.61 |
|
Neptune Global Smaller Companies |
10.74 |
Source: FE Analytics, performance from 30th June to 31st July 2019 in pounds sterling on a total return basis
“Moving to the other end of the spectrum, UK Direct property was the worst performing sector in July, having been the worst performer for 2019. Brexit continues to weigh on the UK property market whilst retail continues to struggle on the high street. The top 10 worst performing sectors are dominated by the more defensive assets with the exception of UK Smaller Companies which put in a small positive return. The UK smaller companies sectors is naturally more domestically focused so as the likelihood of a no-deal Brexit increased so have concerns that the UK will enter a recession shortly afterwards.
“At a fund level, the worst-performing ten funds were dominated by targeted absolute return funds as the asset class continues to find the global macro environment challenging. Several Korean funds feature in the bottom 10 including Baring Korea Trust and Invesco Korean Equtiy and two UK Smaller companies funds – LF Miton UK Smaller Companies and Aberdeen UK Smaller Companies Equity reflecting the poor performance of the sector.”
10 worst-performing sectors
|
Investment Association Sector |
Percentage |
|
UK Direct Property |
0.15 |
|
UK Smaller Companies |
0.2 |
|
Targeted Absolute Return |
0.53 |
|
Sterling High Yield |
0.78 |
|
Sterling Strategic Bond |
1 |
|
UK Equity Income |
1.29 |
|
UK Gilts |
1.43 |
|
Mixed Investment 0-35% Shares |
1.5 |
|
Sterling Corporate Bond |
1.51 |
|
European Smaller Companies |
1.87 |
Source: FE Analytics, performance from 30th June to 31st July 2019 in pounds sterling on a total return basis
10 worst-performing funds
|
Funds |
Percentage |
|
The VT Oxeye Hedged Income Option |
-6.25 |
|
MFS Meridian Global Energy |
-4.96 |
|
SVS Church House Deep Value Investments |
-4.62 |
|
LF Odey Absolute Return |
-4.07 |
|
BMO Global Equity Market Neutral |
-3.44 |
|
LF Miton UK Smaller Companies |
-3.38 |
|
JGF-Jupiter India Select |
-3.28 |
|
Invesco Korean Equity |
-3.28 |
|
Barings Korea Trust |
-3.03 |
|
Aberdeen UK Smaller Companies Equity |
-2.96 |
Source: FE Analytics, performance from 30th June to 31st July 2019 in pounds sterling on a total return basis