Brummer Multi-Strategy UCITS monthly commentary June 2025

Markets

Global equity markets showed resilience in June despite heightened Middle East tensions. U.S. equities, led by tech, gained on strong earnings and trade optimism. Asian markets rose early in the month as U.S.-China tensions eased, while Europe lagged due to tariff concerns.

Markets dipped mid-month amid Israel-Iran conflict fears but rebounded after a ceasefire. U.S. and Asian equities recovered strongly, driven by tech, financials, and falling bond yields. European indices remained subdued, pressured by bond market volatility and a stronger euro.

Bond markets diverged in June. U.S. Treasury and UK Gilt yields declined steadily, driven by expectations of U.S. rate cuts in 2025 and weak UK labour data. In contrast, German Bund yields rose amid budget concerns. Japanese government bond yields fluctuated, falling mid-month as investors sought for safety during the Israel-Iran conflict, then rebounding slightly after a ceasefire restored risk appetite.

Currency markets largely mirrored bond market trends. The U.S. dollar weakened notably against the euro, driven by dovish Fed expectations and German budget concerns, pushing the euro to its highest level against the dollar since October 2021. The Japanese yen also strengthened mid-month, reaffirming its role as a safe-haven currency.

Commodity markets, particularly energy, were heavily impacted by Middle East tensions. Crude oil prices surged following the June 13th missile strikes, with Brent rising as much as 13% amid fears Iran might close the Strait of Hormuz. Prices remained elevated before easing as diplomatic efforts gained traction. Gold prices held steady, while silver and copper posted moderate gains.

Brummer Multi-Strategy UCITS

Long/short equity was the strongest contributor to BMS UCITS’ performance this month as the portfolio continued to show resilience against recent turmoil. The largest contribution to performance came from the US TMT sector, where solid gains were realised across a multitude of sub-sectors. Global healthcare sectors also added meaningfully, driven by profitable positioning in pharmaceuticals & biotech as well as healthcare equipment. The listed real estate sector was a slight drag, as losses in the UK were only partially offset by gains in mainland Europe and Canada. In June, short alpha continued to be the main driver of the total alpha generated by the l/s equity teams year to date. 

Systematic trend following also contributed positively to the performance of BMS UCITS this month as a whole, although gains differed across markets. In developed markets, gains came from long positions in Asian equities, short exposure to the US dollar, and commodity trades in soybeans and fossil fuels. Fixed income was the only drag in this segment. Alternative markets were flat overall, as gains in FX, credit, and equities were offset by losses in commodities and fixed income.

Systematic macro also contributed positively this month, as relative value positioning in commodities such as platinum and fossil fuels proved very profitable for the month, with the gains being lightly offset by some FX and fixed income positions. 

This is marketing communication. Read the fund's information memorandum and key investor document (KID) before making any definitive investment decisions.