Legal Entity Identifier: 213800ON67TJC7F4DL05
The unaudited net asset value of Athelney Trust was 187.2p at 30 June 2025.
Fund Manager’s comment for June 2025
The US economy contracted by 0.5% in Q1, marking its first quarterly decline in three years. The downturn was primarily driven by a slowdown in consumer spending and weaker export activity, partially offset by a decline in imports. Government expenditure also fell sharply, while fixed investment remained resilient. The Federal Reserve kept interest rates unchanged at 4.25%–4.50% for a fourth consecutive meeting. Manufacturing activity rebounded in June, with the PMI rising to 52.9, the highest in over three years, supported by improved output and export orders. The services sector remained robust, although export weakness and rising input costs persisted. Business sentiment dipped, reflecting uncertainty surrounding tariffs and trade policy.
The Eurozone economy expanded by 0.6% in Q1, its strongest growth rate since late 2022. Growth was led by Ireland’s sharp 9.7% rebound, alongside stronger than expected contributions from Germany and Spain. Investment activity improved, while consumption slowed and government spending remained broadly flat. Net trade made a modest positive contribution. The ECB cut rates by 25 basis points in June, citing improving inflation dynamics, with headline inflation projected to fall to 2.0% in 2025. While growth forecasts were marginally revised down, they remain positive, underpinned by robust labour markets and continued public investment. Manufacturing remained weak, with the PMI at 40.5 in June, marking a 35-month contraction streak, although the pace of decline is easing.
The UK economy grew by 0.7% in Q1, the fastest pace in a year, supported by strength in the services and manufacturing sectors, particularly in transport equipment and ICT related output. Business investment rose strongly by 3.9%, and exports outpaced imports, contributing positively to GDP. However, household consumption rose only modestly, and government spending contracted. Year-on-year growth stood at 1.3%. The Bank of England maintained rates at 4.25%, noting persistent inflation risks and geopolitical uncertainty, particularly around energy prices. Manufacturing activity contracted for a ninth consecutive month, albeit at a slower pace (PMI at 47.7), with weak demand and rising input costs prompting further job cuts. The services sector remained in expansion, with a PMI of 51.3, reflecting modest growth in new business.
Global equity markets continued their upward momentum in June, building on May’s strong rebound. Major indices posted further gains, with the MSCI World rising 4.22%, the S&P 500 advancing 4.96%, and the Nasdaq rising 6.57%. In the UK, the FTSE 100 fell -0.14%, while the FTSE 250 increased by 2.85%. The Small Cap and AIM indices gained 3.68% and 3.21%, respectively, with the Fledgling index continuing to outperform, rising 5.13% over the month.
Our portfolio performed well during the month, increasing by 5.10% in June. After providing for expenses, the Portfolio NAV increased by 4.87%. During the month, we added a new holding in Spectra Systems. Spectra Systems is a leader in optical and sensor-based security technology, offering end-to-end systems from specialized materials and sensors to software platforms and fully printed secure products for use in currency, documents, goods, and gaming integrity. The largest contributors to performance were S & U, Begbies and Paypoint, all rising over 10%. The largest detractors from performance were Treatt, Raspberry Pi and Dunelm.
