March Report

Global equity markets declined in March, led by losses in the United States and Europe. US equities fell as investors contended with persistent inflation, hawkish signals from the Federal Reserve, and growing concern over trade tensions following proposals for sweeping tariff increases. Elevated rate expectations and softer consumer data weighed on market sentiment, particularly for growth-oriented and interest-rate-sensitive sectors.

European equities also ended the month lower. While there were signs of stabilisation in regional inflation and pockets of strength in corporate earnings, the broader sentiment was weak. Political uncertainty in the UK and muted economic activity across the eurozone added to investor caution. In contrast, Chinese equities posted gains, supported by a series of positive earnings surprises and improved momentum in industrial production and consumer demand. Japanese equities declined amid more cautious corporate guidance and subdued activity in key manufacturing sectors.

Across global sectors, Energy and Utilities outperformed as investors rotated toward more defensive areas of the market. Information Technology was the weakest sector, reflecting concerns about elevated valuations and emerging competition in AI infrastructure. Consumer Discretionary also lagged, with investor sentiment hurt by soft spending data and poor performance among AI-exposed consumer platforms.

Portfolio Commentary

The Fund was more resilient than the benchmark in March, supported by relative strength in Healthcare and Financials, which helped offset weaker performance in Information Technology and Industrials. Heightened market volatility, driven by persistent inflation and escalating trade tensions, created a challenging backdrop for equity markets.

UnitedHealth Group was a key contributor. The US-based health insurer advanced as investors responded positively to signs of progress toward the dismissal of a federal lawsuit related to Medicare billing practices. With limited exposure to international trade or supply chain disruptions, UnitedHealth’s defensive profile proved beneficial in the month’s risk-off environment. Tradeweb also contributed positively. The fixed income trading platform benefited from higher institutional trading activity driven by increased market volatility, supporting transaction volumes across its electronic markets.

In contrast, Schneider Electric detracted from performance. The French energy management and automation group remains well exposed to long-term trends in electrification and infrastructure investment. However, recent investor scepticism regarding the capital expenditure outlook of large data centre operators weighed on sentiment, leading to near-term uncertainty around growth expectations.

The Fund initiated a position in Trade Desk during the month. The US-based advertising technology platform enables advertisers to optimise and evaluate digital campaigns through an independent and transparent interface. Shares declined following a quarterly result that missed expectations, creating what the investment team viewed as an attractive entry point. The company’s impartial position and scalable model offer a compelling alternative to larger, vertically integrated platforms such as Google, Meta, and Amazon.

While market volatility remains elevated, the Fund continues to focus on identifying companies with durable competitive advantages, strong cash flows, and long-term growth potential. The current environment underscores the value of a research-driven approach that emphasises business quality, industry structure, and sustainable profitability in navigating uncertainty.