NVSEF - Franklin Mutual Global Discovery Fund Q2 2025 Commentary
2025-07-27 16:00:00 ET
Key Takeaways
- Markets: While the US tariff announcement at the start of the second quarter of 2025 sparked significant swings in global equity markets, as measured by the MSCI World Index in US dollar terms, trade tensions eased over the remainder of the quarter, and reduced recession fears helped push global markets higher.
- Contributors: Stock selection in industrials, health care and consumer staples supported relative returns. Deutsche Bank (DB), Ferguson Enterprises (FERG) and Johnson Controls International (JCI) were among the contributors.
- Detractors: Security selection in information technology, financials and materials hampered relative performance. Individual detractors included Zimmer Biomet Holdings (ZBH), SLB (SLB) and Global Payments (GPN).
- Outlook: While we believe there are reasons to be optimistic about the markets, we think uncertainty surrounding trade and geopolitics could continue to generate pockets of volatility in the near term. Recent US policy shifts have led European officials to enact changes which we think are bolstering conditions for improved economic growth and competitiveness, which when coupled with already low valuations can create potential for compelling investment opportunities.