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What Goes Up Must Come Down...

27 June 2023

What Goes Up Must Come Down...
What Goes Up Must Come Down...

Weeks like this come around once in a while, and to be expected with a higher risk portfolio like I am running. Been a storming few weeks, so was expecting a reversal!

UK inflation figures and the unexpected 50bps hike from the Bank of England took a bit out of the UK based holdings, and set a cautious tone more broadly.

Biggest detractor on the week was Eramet, which is now trading close to its lows for the year. There has been some downwards pressure on nickel and manganese prices this last week.

What I am keen to see on this position is how the market digests the recent Russian mutiny events. Defence stocks took a beating early this week, on the expectation that these events have accelerated the end of the Ukraine conflict and so will impact defence spending. Much of Eramet’s products are used in the steel, aerospace etc so could be impacted from falling defence spending. Something to watch out for.

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