October was another positive month for global stock markets. The prolonged US government shutdown and emergent issues in private debt markets were not enough to suppress investor excitement towards the AI investment boom. The mood was also helped by reasonable economic data and corporate earnings, a trade truce between the US and China, and a reduction in US interest rates. Closer to home, ahead of the autumn statement, sentiment towards the UK economy and political environment remained weak.
Evenlode Income rose +4.2% compared to a rise of +3.2% for the IA UK All Companies sector and +3.7% for the FTSE All-Share. The strongest contributors to fund performance were LSEG, GSK, Unilever and LVMH, all of which released positive third-quarter updates, with Unilever and LVMH confirming full-year 2025 guidance, and LSEG and GSK raising theirs. Smiths Group was also a strong contributor, announcing the sale of its Interconnect business to Molex, a Koch company, for an enterprise value of £1.3bn, exceeding consensus expectations.
The most negative contributors were RELX and Experian. RELX released a strong third-quarter trading update, with revenue growing +7% on an organic basis* in the first nine months of the year, and full-year guidance reaffirmed. Experian’s share price decreased following an announcement by Fair Isaac Corporation (FICO) regarding changes to the distribution of FICO credit scores in the US mortgage market. We do not expect this to have a material impact on Experian, which has since reaffirmed current-year and medium-term financial guidance.
Across the portfolio, we continue to prioritise a diverse collection of high-quality businesses that enjoy strong competitive advantages, healthy cash generation, resilient long-term growth prospects and low levels of debt and leverage. These are qualities that have been underappreciated in recent months as polarised sector performance and a fear-of-missing-out psychology have prevailed in both UK and global markets. Over the long term though, thanks to the power of quiet compounding, these companies tend to be great friends to their shareholders.
*Organic basis excludes impact of mergers/ acquisitions and foreign exchange.
October was another positive month for global stock markets. The prolonged US government shutdown and emergent issues in private debt markets were not enough to suppress investor excitement towards the AI investment boom. The mood was also helped by reasonable economic data and corporate earnings, a trade truce between the US and China, and a reduction in US interest rates. Closer to home, ahead of the autumn statement, sentiment towards the UK economy and political environment remained weak.
Evenlode Income rose +4.2% compared to a rise of +3.2% for the IA UK All Companies sector and +3.7% for the FTSE All-Share. The strongest contributors to fund performance were LSEG, GSK, Unilever and LVMH, all of which released positive third-quarter updates, with Unilever and LVMH confirming full-year 2025 guidance, and LSEG and GSK raising theirs. Smiths Group was also a strong contributor, announcing the sale of its Interconnect business to Molex, a Koch company, for an enterprise value of £1.3bn, exceeding consensus expectations.
The most negative contributors were RELX and Experian. RELX released a strong third-quarter trading update, with revenue growing +7% on an organic basis* in the first nine months of the year, and full-year guidance reaffirmed. Experian’s share price decreased following an announcement by Fair Isaac Corporation (FICO) regarding changes to the distribution of FICO credit scores in the US mortgage market. We do not expect this to have a material impact on Experian, which has since reaffirmed current-year and medium-term financial guidance.
Across the portfolio, we continue to prioritise a diverse collection of high-quality businesses that enjoy strong competitive advantages, healthy cash generation, resilient long-term growth prospects and low levels of debt and leverage. These are qualities that have been underappreciated in recent months as polarised sector performance and a fear-of-missing-out psychology have prevailed in both UK and global markets. Over the long term though, thanks to the power of quiet compounding, these companies tend to be great friends to their shareholders.
*Organic basis excludes impact of mergers/ acquisitions and foreign exchange.