After the strong rally in recent months, the market seemed to enter a holding pattern in June. The level of economic activity and business confidence continued to improve as economies further loosened restrictions, albeit both are still a long way from pre-Pandemic norms. Fiscal and monetary support also continued, with further measures announced by the Chancellor in the last few days to aid those businesses most impacted. Across Europe and the UK, we continue to see localised spikes in cases which, thus far, have been contained by local authorities. The US, however, is a different story with an acceleration in number of cases throughout the month. With COVID-19 having dominated headlines in Q2, other political and economic considerations are starting to re-emerge, with increased tension between the UK and China over the issue of Huawei and ongoing trade talks between the UK and the EU ahead of the end of the transition phase.
With this uncertainty on the horizon, we continued our pivot towards less economically correlated shares. We started a holding in AFH Financial, an acquisitive wealth management company, and continued to add to our positions in Marlowe and Boku, as they both raised funds to make sensible acquisitions. We also trimmed some holdings where the shares had had a very good run, namely XP Power and Liontrust, and reduced our position in Tremor International after a disappointing trading update.
Our best performer in the month was Premier Foods, who announced their full-year results. Management have worked hard to reinvigorate their well-known consumer brands, and this was demonstrated with 11 consecutive quarters of UK revenue growth and a strong outlook for the coming year, combined with progress de-leveraging their balance sheet and de-risking their historic pension schemes. Zegona also performed well as Euskaltel, in which Zegona have a large shareholding, began its nationwide roll-out in Spain, combined with a share buyback with surplus cash. Our poorer performers Synthomer, Future and Clinigen, were not driven by specific newsflow, but had all rallied strongly and gave up some of these recent gains.