Equity markets rallied for a fourth consecutive month, with the oil price trading below $60 for most of the month and Q3 earnings results highlighting continued strength across much of the corporate sector. While the Japanese market registered a modest decline in sterling terms, all other major indices delivered solid growth led by strength in the UK and Asia ex-Japan markets.The Global Fund rose 2.4% against the 1.6% advance of the benchmark index, led by good outperformance across the Continental European and US stocks. Gains were broad-based at the individual stock level, with particularly strong performances registered by Rio Tinto, Hermes and C&C Group in Europe, with Mandarin Oriental in Singapore and Barloworld in South Africa also posting double-digit growth.Again, there was relatively little trading activity in the Fund. We successfully participated in two IPOs during the month, SAIC Inc in the US and Gagfa SA in Germany, also adding a new position in Inverness Medical, a small US medical diagnostics company, after a positive meeting with management and optimism over the impact of a pending joint venture with Procter & Gamble.Against these purchases, we booked profits in Tod's and Chubb Corp and reduced our holding in Schlumberger. While Democratic success in the US mid-term elections may dampen sentiment near term, solid operating fundamentals and reasonable valuations are likely to continue attracting money into the equity markets, reinforced by ongoing M&A activity.
