After a March in which vast swathes of the developed world was subject to lockdown, April saw many countries returning to work or setting a clear timetable for the loosening of current restrictions. April also featured progress in the medical fightback against COVID-19, with vaccine trials commencing and positive data from a number of potential treatments. Combined with the high level of monetary and fiscal support, this drove an improvement in market sentiment and a market rally through the month, despite some dreadful short-term economic data. As we enter May, some of this exuberance has dissipated, as it becomes clear that the global economy is unlikely to rebound as sharply as it fell, with some sectors, such as leisure and air travel, particularly impacted.
At a stock level, company statements continue to focus on how they are managing the lockdown and their strategy on re-opening, with the uncertainty this creates making it very difficult for management to provide earnings estimates with any level of confidence. To this end, we have been pivoting the portfolio towards firms that should have robust earnings even in a depressed economic climate. This is demonstrated by two new holdings in the month. Zegona Communications, an acquirer of European TMT assets, currently owns a large share of Euskaltel, a Spanish telecommunications company, who have seen limited impact of the lockdown on trading and have ambitious business plans to expand their market share in Spain. We also started a holding in Advanced Medical Solutions, a leading developer and manufacturer of products for the global surgical and woundcare markets. Finally, we added to our holding in IMImobile, as they took proactive steps to improve their balance sheet via a share placing. As a provider of infrastructure for companies to communicate with their customers and a diverse client base, we think they should continue to trade well through this period.
Our best performers in April broadly fell into two camps. Firstly, some of our more highly indebted companies which sold off sharply in March, such as Elementis, Clinigen and Weir, rallied strongly in April in line with market sentiment. Additionally, two of our less economically correlated holdings, FRP Advisory (restructuring advisory) and EKF Diagnostics, performed well, with the latter trading ahead of expectations due to increased demand for the manufacture of a sample collection device used, amongst other things, for COVID-19 testing. From a negative perspective, Ocean Outdoor was weak due to its exposure to the deteriorating media and advertising markets.