Scottish Mortgage Investment Trust and other trusts lifted by buoyant markets


Scottish Mortgage Investment Trust PLC (LSE:SMT) shares were in demand on Tuesday after the S&P 500 and the tech-heavy Nasdaq Composite hit new highs yesterday.

Although the investment trust, famed for its early moves into tech giants Facebook and Alphabet (i.e. Google) seems to be shifting its emphasis to Chinese companies these days, it still has a large exposure to US technology and biotech companies, so yesterday’s 0.9% rise on the Nasdaq Composite is likely to have given the trust’s net asset value a boost.

In fact, with the shares up 0.82% at 1,372p, today’s gain has almost exactly mirrored yesterday’s rise on the Nasdaq.

Meanwhile, on the FTSE 250, investment trusts and asset managers are in demand, as markets continue to recover from the pandemic nightmare.

“Nasdaq hit fresh record on Monday, as Apple, Google, Facebook traded at all-time highs at the wake of Jerome Powell’s Jackson Hole speech, where Powell said tapering is coming and the markets priced the fact that we have no details on the start date and on the pace of winding down the bond purchases,” said Ipek Ozkardeskaya at Swissquote.

Richard Hunter, the head of markets at interactive investor, said “the balanced rhetoric” from Jackson Hole continued to support sentiment into the new week, sending the S&P500 and Nasdaq to further record closing highs.

“Federal Reserve Chairman Powell walked a potential tightrope with aplomb, reiterating previous thoughts around a labour market which has to fully recover and the limitations which the Delta variant places on the recovery. At the same time, he acknowledged that at current rates of growth, tapering may yet begin before the end of this year, but implied that any tapering would be a separate decision from considering a rise in interest rates.

“The Dow did not participate in the rally on Monday, hampered by weaker financial shares. There was also concern around the economic impact of Hurricane Ida, particularly in terms of oil and gas production in the affected areas, as well as the potential costs of reparation as seen in previous instances,” he added.

“Even so, markets remain in rude health overall in the US with the Dow Jones having added 15.7% in the year to date, the S&P500 20.6% and the Nasdaq 18.5%,” Hunter concluded.

Feeling the benefit of those market surges on the FTSE 250 were investment trusts Baillie Gifford Shin Nippon PLC, JPMorgan Euro Discovery Trust PLC, Vietnam Enterprise Investments and Allianz Technology Trust PLC (LSE:ATT), which were up by 1.5% to 1.7%.

Among the mid-cap asset managers, Liontrust Asset Management (LSE:LIO) PLC was the pick of the bunch, up 1.5%.


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