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Key takeaways
- European equities rise but AI concerns continue to influence sector performance. The market backdrop provided a tough environment for both the long and short books in February.
- Ahold Delhaize and ArcelorMittal both recorded strong gains after releasing better-than-expected quarterly results.
- Online travel agency Booking Holdings sold off as it was caught up amid wider fears over the potential for AI tools to threaten a range of businesses, particularly those providing software or online tools.
Performance
The Fund’s A4 share class returned -0.2%* in euro terms in February. The Fund’s comparator benchmarks, the MSCI Europe Index and HFRX Equity Hedge EUR Index, returned 4.1% and 0.7% respectively.
Commentary
European equity markets registered gains in February despite ongoing concerns around the impact of AI on certain sectors, as well as a spike in geopolitical risk at the end of the month as the US and Israel launched attacks on Iran.
Software and professional services firms were among those in focus due to the potential for AI tools to undermine their core businesses. At the same time, investors continued to show some nervousness over the scale of capital investment from the biggest AI players.
Most sectors of the MSCI Europe Index were in positive territory in euro terms, although there was a large range of dispersion between the largest gainers, defensive areas including communication services (+10%) and consumer staples (+9.5%), and the more cyclical laggards such as financials (-0.1%) and consumer discretionary (+1.5%). Real estate (+10.8%) was also a notable gainer.
The market backdrop provided a tough environment for both the long and short books in February. Gains in the long book lagged the market rise slightly, while the short book saw some positions experience outsized gains. Negative short book contributions included a Swedish heating and plumbing group and French semiconductor substrates manufacturer, which both comfortably beat expectations with quarterly results.
Within the long book, steel producer ArcelorMittal (+23%) beat analyst estimates with its Q4 EBITDA of $6.5 billion, equivalent to $121 per tonne. Investors were also encouraged by a 2026 outlook which predicts a 2% increase in global ex-China demand growth, as well as highlighting the potential for ArcelorMittal to benefit from greater domestic European production as trade tariffs reduce the attractiveness of imports. Following strong cash generation, the company announced a 9% dividend increase and committed to returning 50% of free cash flow via share buybacks.
Shares in French construction and concessions group Eiffage (+19%) rallied ahead of 2025 results which showed a 4.8% like-for-like revenue increase to over €25 billion. Over the next year, Eiffage expects revenue growth to slow but operating profit to benefit from improved margins.
Online travel agency Booking Holdings (-15%) sold off amid wider fears over the potential for AI tools to threaten a range of businesses, particularly those providing software or online tools. The company itself reported 9% growth in room nights in Q4, lifting revenue 11% in constant currency terms. While acknowledging the accelerating pace of change in the travel industry, Booking emphasised the opportunity to deploy generative AI itself and issued an upbeat 2026 outlook of high single digit growth in both bookings and revenues.
Swiss building materials group Holcim (-8.9%) lost some ground on speculation that the EU could delay plans to withdraw carbon allowances. This measure had been expected to reduce supply and improve market dynamics for major players, such as Holcim, that can comply with decarbonisation regulations.
Discrete years' performance (%) to previous quarter-end**:
| Dec-25 | Dec-24 | Dec-23 | Dec-22 | Dec-21 |
Liontrust GF European Strategic Equity A4 Acc EUR | 4.1% | 18.5% | 1.4% | 18.3% | 32.9% |
MSCI Europe | 19.4% | 8.6% | 15.8% | -9.5 | 25.1% |
HFRX Equity Hedge EUR | 7.8% | 6.2% | 4.7% | -5.2% | 11.0% |
| Dec-20 | Dec-19 | Dec-18 | Dec-17 | Dec-16 |
Liontrust GF European Strategic Equity A4 Acc EUR | -10.0% | 23.2% | -7.1% | 4.2% | 4.8% |
MSCI Europe | -3.3% | 26.0% | -10.6% | 10.2% | 2.6% |
HFRX Equity Hedge EUR | 2.9% | 8.5% | -12.3% | 7.8% | -1.7% |
*Source: Financial Express, as at 28.02.26, total return (income reinvested and net of fees).
**Source: Financial Express, as at 31.12.25, total return (income reinvested and net of fees). Investment decisions should not be based on short-term performance.
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KEY RISKS
Past performance does not predict future returns. You may get back less than you originally invested.
We recommend this fund is held long term (minimum period of 5 years). We recommend that you hold this fund as part of a diversified portfolio of investments.
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