THERE was an increasing polarisation of sector performance in the UK stock market in the six months to the end of September, according to the manager of the £1.5 billion Edinburgh Investment Trust.
Invesco Asset Management’s Mark Barnett said this was down to “the turbulent political environment and the improving global economy”, which saw the FTSE 100 reach a record high in June only for “growing tensions between the United States of America and North Korea” to lead to “nervousness in global equity markets” thereafter.
The trust underperformed its benchmark, the FTSE All-Share, during the period, making a net asset value total return of 0.3 per cent against the market’s 3.6 per cent.
Mr Barnett said his investments in Provident Financial, which issued a profit warning in August, and tobacco companies Altria, British American Tobacco (BAT), Imperial Brands and Reynolds American detracted from the trust’s performance.
BAT is the portfolio’s largest holding, accounting for 7.6 per cent of the total. Imperial Brands also sits within Mr Barnett’s top 10.
Despite the underperformance, investors will receive a marginally improved first interim dividend for the year to March 2018 of 5.8p. Last year the first interim payment was 5.4p.
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