Fidelity Emerging Markets Limited (LON:FEML) has announced its monthly factsheet for November 2023.
Portfolio Manager Commentary
Emerging markets rebounded in November and registered the largest monthly gain since January, but slightly underperformed developed markets. Sentiment improved as the US dollar pulled back and bond yields came down, and it appeared that the US Federal Reserve (Fed) was reaching the end of its rate tightening cycle. All regions posted positive returns, led by Latin America, followed by emerging Asia, and finally emerging Europe, the Middle East and Africa (EMEA).
The portfolio underperformed the index over the month. At the country level, stock picking in Hong Kong and Canada detracted from returns, while the underweight exposure to China, and stock picking in Kazakhstan and South Africa added value. The broader China market was weak over the month as consumer confidence and macroeconomic indicators remained subdued. The overweight positions in dairy producer China Mengniu and sportwear brand Li Ning continued to detract. Kazakhstan’s e-commerce and payments platform Kaspi continued to exhibit strength as investors reacted favourably to the company’s consistently strong earnings announcements over the year and sustained dividend growth. South African businesses PPC and Naspers both contributed to relative returns. Naspers (a large shareholder in China’s Tencent) climbed after Tencent reported strong Q3 results over the month.
The Company’s NAV fell 3.6% during the 12-month period ended 30 November 2023, underperforming its reference index which fell by 2.0%. The Company’s share price rose 1.7% over the same period.
