Monthly report May 2025 of the zCapital Swiss Small & Mid Cap Fund (class A)
The fund gained 5.4% in May (SPI Extra +6.2%). We participated in the latest share placement of dermatology company Galderma. We made further purchases in Sunrise, Roche, SFS, and Landis+Gyr. Conversely, we reduced our positions in Clariant and Belimo.
The US trade dispute continued to dominate financial markets in May. USA and China agreed to substantially reduce mutual import tariffs for 90 days. This welcome news led to broad-based gains. Towards the end of the month, the US President once again demonstrated his flip-flopping trade policy. His threat to impose 50% import tariffs on EU goods as of 1 June was swiftly followed by a U-turn.
In the two major industrialised countries, the US and Japan, long-term interest rates are trending upwards. This makes corporate loans and mortgages more expensive. They also lead to higher costs for servicing government debt. Although the risk of recession in the US has been reduced by the temporary easing of the trade dispute with China, little has been done to improve planning security for companies. After the strong recovery, the performance potential of the stock markets appears limited.
