SJB | Korschenbroich, 04.08.2023.
Globale Aktien konnten sich im zweiten Quartal auf ein 14-Monats-Hoch bewegen und verzeichneten eine starke Juni-Performance. Im Berichtsmonat war der Sektor Energieeffizienz der beste im FondsPortfolio, wo sich die Aktien von Unternehmen wie Eaton, Schneider und Johnson Controls besonders stark zeigten. In diesem freundlichen Marktumfeld generierte der Pictet – Global Environmental Opportunities P EUR (WKN A1C3LN, ISIN LU0503631805) eine Wertentwicklung von +2,62 Prozent auf Monatsbasis und notiert seit Jahresbeginn mit +11,18 Prozent im Plus. Der aktuelle Monatsbericht von Pictet-FondsManager Luciano Diana analysiert für alle Investoren der FondsStrategie SJB Nachhaltig die Veränderungen im Portfolio und liefert einen Ausblick für die Aktienmärkte des Environmental-Sektors.
Market Review
Equities enjoyed strong gains in the quarter, with the MSCI All-Country World Index hitting a 14-month high, ending the quarter on a high note with a strong June performance. Investors are increasingly confident that efforts by central banks, led by the Fed, to tame inflation are beginning to have the desired effect and that the global economy can avoid a sharp downturn. Data showed clear evidence of moderating inflation in the US, with the May PCE price index registering its smallest year-on-year increase since April 2021 (3.8%). However, a surprise drop in initial jobless claims and strong first-quarter GDP data underscored US economic resilience, suggesting that the Fed’s rate hike campaign may have to run for a little longer. Industrials and Tech companies were the biggest gainers while Energy, Materials, Utilities and Consumer Staples lagged. IT stocks rose by more than 14% in US dollar terms as a strong earnings forecast from chip company Nvidia triggered a rally. The tech-heavy Nasdaq Composite has risen by more than 30% in the first half of 2023, its best performance in four decades.
Performance Analysis
The strategy underperformed the MSCI AC World Index during the quarter. Energy Efficiency was the strongest segment, with industrial and building efficiency stocks such as Eaton, Schneider and Johnson Controls as well as semiconductor stocks such as Onsemi, Applied Materials and Tokyo Electron contributing positively thanks to strong quarterly results and positive end-market demand. Dematerialized Economy also contributed positively, in particular Cadence, Synopsys and PTC, following accelerating growth trends. Pollution Control detracted, as good performance in Tetra Tech was more than offset by weakness in Agilent and Thermo Fisher, which experienced a de-rating due to investor concerns on the pharma funding environment. Waste Management & Recycling also detracted, in particular containerboard packaging stocks such as Stora Enso and Smurfit Kappa, which are facing industry headwinds. Within Water, Xylem rebounded but American Water continued to detract. Within Renewables, Solaredge detracted from performance. Within Sustainable Agriculture & Forestry, West Fraser outperformed.
Portfolio-Aktivity – Under- and Overweightings
During the quarter, we reduced our exposure to Energy Efficiency and Pollution Control while we added exposure to Waste Management & Recycling. In Energy Efficiency, we took some profits in Eaton, Johnson Controls, Legrand, Equinix, Keyence, Applied Materials and Tokyo Electron following strong stock performance year-to-date, notwithstanding a continued very strong business outlook. We also initiated a new position in Carrier Global Corp, a leading provider of building climate solutions, and continued to add to Trane Technologies. In Dematerialized Economy, we trimmed our positions in Cadence and Synopsys, based on valuations. In Waste Management & Recycling, we added to Republic Services and Waste Management and we also added to Westrock and Stora Enso amidst share price weakness and negative sentiment. In Pollution Control, we continued to add to our position in WSP Global, while we reduced Thermo Fisher and we exited our position in Eurofins based on lower confidence on business plan execution. In Renewables, we added to our position in Orsted following an investor event.
Market Outlook
Energy Efficiency and Dematerialized Economy, two of our largest portfolio segments, continue to show strong fundamentals for the rest of the year. Demand for energy-saving technologies remains robust, and our companies are starting to benefit from the positive impact of the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA) in the US. These represent a multi-year investment cycle for semiconductor and battery plants, electricity grid modernization, renewable energy capacity, green buildings and EV infrastructure, which adds growth and revenue visibility to our companies. As a consequence of this, the end-market demand for environmental services within the Pollution Control segment also remains very healthy, particularly in the US. Within Dematerialized Economy, demand for simulation software, Electronic Design Automation and Product Life-Cycle Management solutions is accelerating. In general, most of our portfolio holdings have sufficient pricing power and balance sheet strength to navigate well in the current environment. Supply chain constraints are easing and this should provide a tailwind for margins in the coming months.
Portfolio Strategy
Our strategy focuses on investing in environmental solutions providers. Exposureto environmental trends offers investors attractive risk-adjusted returns, regardless of the stage of the economic cycle. We favour solutions providers withwide economic moats, robust profitability, healthy balance sheets and businessmodels that don’t rely on government subsidies. Our bottom-up investmentprocess results in a concentrated global portfolio with a growth and quality bias.Long term, the trends of population growth and rising living standards areinescapable and so is the growing strain on natural resources. Awareness ofenvironmental issues has grown tremendously in the last few years and is nowdeep-seated, top of mind for an entire generation of citizens, consumers andinvestors.
Pictet – Global Environmental Opportunities Management Team
Luciano Diana
Gabriel Micheli
Yi Du
