KR - Harris Associates Global Strategy Q1 2024 Commentary

2024-05-25 11:00:00 ET

Summary

• Harris Associates is an asset management firm that serves as the investment adviser to the Oakmark Funds. We seek to invest in businesses that are priced at substantial discounts to our estimate of intrinsic value.
• Major global equity markets showed strength in Q1 2024, aided by excitement surrounding artificial intelligence and expectations for rate cuts from central banks.
• The portfolio's return for the reporting period was 4.57%, compared to the MSCI World Index's return of 8.88%.
• Daimler Truck Holding, Fiserv, and Kroger were top contributors to the portfolio, while Charter Communications, Bayer, and Worldline were top detractors.

Market Environment

Major global equity markets showed strength throughout the first quarter of 2024. The U.S. and Europe were aided by excitement surrounding artificial intelligence, encouraging economic data and investor expectations for rate cuts from central banks this calendar year. During the quarter, U.S. equity markets reached new highs and Japanese equities continued to rise, surpassing a record high from 34 years ago. While equities in China had been pressured throughout 2023, the first quarter of 2024 showed a recovery. In March, the U.S. Federal Reserve, Bank of England, European Central Bank and Bank of Japan all held meetings. While the U.S., U.K. and Europe chose to leave interest rates unchanged while they continue to monitor evolving economic data, the Bank of Japan enacted its first rate hike since 2007 and exited negative interest rate territory....

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