NKE - Mar Vista Q2 2024 Focus Portfolio Commentary

2024-07-16 07:50:00 ET

Summary

• The S&P 500® Index advanced 15.29% in the first half of 2024, one of its strongest performances since the late 1990s tech boom.
• Six "megacap" firms (Nvidia, Alphabet, Microsoft, Amazon, Meta, and Apple), benefiting from artificial intelligence (AI) enthusiasm, have contributed approximately 60% of the market's year-to-date gains. Nvidia stands out with a 30% contribution to the first-half advance.
• Mar Vista’s Focus strategy returned +3.74% net-of-fees in the second quarter of 2024. The Russell 1000® Growth Index and the S&P 500® Index returned +8.34% and +4.28%, respectively.
• The second quarter’s top contributors were Apple, Alphabet, and Microsoft. The top detractors were Walt Disney, Salesforce, and Nike.
• We established new investments in Broadcom, Meta Platforms, and added capital to Apple. Investments in Alphabet, Adobe, Microchip Technologies, and Walt Disney were modestly reduced.

Commentary

The S&P 500® Index ("S&P 500®") appreciated 15.29% in the first half of 2024, one of its strongest performances since the late 1990s tech boom, though still slightly below 2023's exceptional start. This year's growth has been primarily driven by six major tech companies: Nvidia, Alphabet, Microsoft, Amazon, Meta, and Apple. These "megacap" firms, benefiting from artificial intelligence ((AI)) enthusiasm, have contributed approximately 60% of the market's year-to-date gains. Nvidia stands out with a 30% contribution to the first-half advance. The market impact of AI has drawn comparisons to other transformative technologies, but the rapid rise in AI stock valuations is noteworthy. Nvidia's market capitalization now exceeds the value of the German, French, and UK stock markets combined....

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