Following a cautious climate in April, May witnessed positive developments across many of the world’s stock markets. All Nordic stock markets experienced upward movements, while U.S. indices, the S&P 500 and Nasdaq, rose by 5% and 6% respectively, significantly driven by technology companies. This positive trend is largely attributed to the anticipated interest rate cuts and a generally more optimistic economic outlook. After the Swedish Riksbank cut its interest rate in May, the ECB followed last week, with the U.S. likely to implement a cut later. However, the strong performance of the U.S. economy is anticipated to bolster corporate profits, counterbalancing the effects.
Several of our portfolio companies reported strong monthly figures. In Finland, our holding in Wärtsilä increased by nearly 12%, making a substantial contribution to the Nordic fund both monthly and annually. The company has released two promising quarterly reports this year, with the latest report highlighting higher-than-expected order intake and significant contributions from the marine segment. Our new holding in Mycronic, included in NE Strategy, also delivered strong monthly returns. Mycronic manufactures advanced systems for creating precise patterns necessary for semiconductor chip production and is considered a potential beneficiary of AI advancements. The company has shown solid growth since the beginning of the year.
Globally, our relatively new Japanese holding in Asics has performed very well. Asics, known for its popular running shoes, delivered unexpectedly strong results in May, surpassing previous guidance across all segments and regions. Furthermore, Nvidia continued its strong performance, rising approximately 30% this month. Elon Musk announced plans to use Nvidia’s chips for his generative AI startup, and Nvidia recently unveiled a new AI chip. The company’s CEO also indicated plans to launch new chips annually. We remain optimistic about its future trajectory.
