Job Curtis, Portfolio Manager of The City of London Investment Trust, reflects on factors that affected performance during the first quarter and looks at the role oil and mining companies might play in decarbonization and electrification. Job also provides his outlook for UK dividends in the coming months.
The City of London Investment Trust has performed well to begin the year as investors hunt for bargains in the UK market. Oil and mining companies have benefitted from higher commodity prices, whilst the strength in financials reflects rising interest rate expectations.
Valuations in the UK market remain cheap compared to global peers and takeover bids from overseas companies reflect this. However, headwinds remain, including worsening geopolitical tensions and the prospect of higher interest rates to curb soaring inflation.
Decarbonising the planet will be neither straightforward nor quick. However, oil and mining companies will have a big part to play in the transition towards cleaner energy sources.
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