F&C NAV down 5.5%, cautious outlook

30th Jul 2009 09:40

Investment trust Foreign & Colonial reported a 5.5% drop in net asset value per share and said it is cautious about the rest of 2009.Net asset value per share (debt at market value) fell to 242.59p in the six month ended 30 June (30 June 2008 316.93p and 31 December 2008 256.59p), while the group's net asset value per share total return was minus 4.1% (taking debt at market value).F&C's index benchmark return was minus 2.9% and the weighted average return of its close peer group was minus 1.2%.An interim dividend of 3.00 pence per share will be paid on 9 September and the group said it intend to recommend a final dividend of at least 3.45 pence per share."After the sharp rally in markets since March, which has continued after 30 June, we are cautious about the rest of 2009," said chairman Mark Loveday."There are very few signs of sustainable economic recovery and there is huge uncertainty about how and when governments and central banks will step back from the extraordinary measures they have had to take in the last two years.""Moving too fast by raising interest rates could choke off any recovery but moving too slowly will lead to rising inflation. On balance we think that inflation is more likely than deflation," he added.