JPMorgan European Growth & Income sees improving investor sentiment after H1 outperformance

(Sharecast News) - London-listed investment trust JPMorgan European Growth & Income said it was the best-performing investment trust in its sector over the six months to 30 September, with its portfolio outperforming wider benchmarks by 3.5 percentage points. The trust, which holds cross-industry equity investments across Continental Europe - the biggest being ASML, Novartis and Siemens - reported a total return on net asset value per share of 14.2% over the fiscal first half, compared with benchmark returns of 10.7%.

The benchmark outperformance now stands at 13.2pp over the past there years and 33.4pp over the past five.

The dividend for the first half was 2.4p per share, with the board maintaining its target to pay out 4% of the previous year-end NAV.

Looking ahead, despite a volatile geopolitical outlook for the region, the firm said that valuations of European companies still remain attractive, "particularly relative to their US counterparts", while investment flows into European markets "have started to pick up".

The company did highlight the uncertainty caused by US trade tariffs, as well as the significant capex boom in AI software and infrastructure - amid recent wider market concerns about stretched valuations in the semiconductor and AI-related sectors.

"However, there are tentative signs economic growth in the Eurozone will improve with plenty of self-help and we are seeing positive investor sentiment towards European equity markets," chair Rita Dhut said in an outlook statement.

As of 31 October, nearly half of the trust's portfolio was invested in just four sectors: capital goods (16.7%), banks (12.1%), pharma, biotech and life sciences (11.4%) and insurance (7.4%). In contrast, the chip sector accounted for just 5.0% of the portfolio, while software and services made up just 3.2% of all investments.

The stock was down 0.7% at 134p by 1436 GMT.