29 April 2024
CQS New
City High Yield Fund Limited
("NCYF" or the "Company")
Monthly Fact Sheet as at 31 March 2024
The Company's Fact Sheet as at 31
March 2024 has been submitted and is available for inspection on
the Company's website: https://ncim.co.uk/cqs-new-city-high-yield-fund-ltd/.
The investment manager updates on
the wider macro-economic environment and on key changes to the
portfolio positions as at 31 March 2024. "
Ian "Franco" Francis, investment
manager at New City Yield Fund Ltd comments[1]: "The recession in the UK, albeit one
of the briefest, appears to be over for now. Manufacturing output
is now back in positive territory, and the overall S&P Global
Flash UK Manufacturing PMI is at a 20-month high at 49.9 - not
quite in growth yet but getting there. Meanwhile we believe
Services showed good growth despite the minor slowdown in momentum.
Overall business confidence appears to be remaining at a good level
for the year ahead, the only cloud on the horizon is inflation.
Although it fell to 3.4% in February, it is still higher than the
US and Europe. Furthermore, the rise in the minimum wage in April
is likely to push wage demands higher as the workforce tries to
maintain pay differentials for more skilled workers. Although we
have had more dovish noises from the Governor of the Bank of
England, Andrew Bailey, we believe the Bank is unlikely to cut
rates before June/July, once it can be more confident of the
inflation rate approaching the 2% target.
"Europe appears to be being held
back by its two major economies, France and Germany. In France,
both Services and Manufacturing are contracting, whilst in Germany
Manufacturing still appears to be in the doldrums, and Services are
just treading water. This will likely have a positive knock-on
effect of cooling inflation further as wage demands in both sectors
are decreasing. This news will be welcomed by the European Central
Bank (ECB) and keep them on track for the well telegraphed interest
rate cut in June.
"The US is still in growth mode with
Manufacturing hitting a 21-month high whilst Services are still
growing, but at a slower pace. Inflation increased marginally to
3.2% in February, up from 3.1% in January. It is likely to have
increased in March as well on the back of fuel prices and wage
demands. It is interesting to note that the comments from the
Governor of the Federal Reserve Bank are more dovish, as the Bank
appears to be more sanguine about inflation and more focused on
keeping the recovery going.
"For the Company's portfolio we
added further to Royal London 10 1/8% perpetual. We also opened a
new holding in Morrisons Fuel Group Term Loan with a coupon of
SONIA plus 575bps at issue. We are anticipating a busier month in
European and the UK High Yield market in April, although we will
have to wait to see whether the quality or the yields on offer are
suitable for the Fund."
-ENDS-
For
Further Information
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CQS
New City High Yield Fund Limited
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T: +44 (0) 20 7201 6900
E: contactncim@cqsm.com
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Singer Capital Markets
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T: +44 (0) 20 7496 3000
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TB
Cardew
Tania Wild
Henry Crane
Liam Kline
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T: +44 (0) 20 7930 0777
M: +44 (0) 7425 536 903
M: +44 (0) 7918 207 157
M :+44 (0) 7827
130429
E: ncyf@tbcardew.com
https://www.tbcardew.com/
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Company Secretary and Administrator
BNP Paribas S.A., Jersey
Branch
Jeremy
Hamon
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T: 01534 709
108
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About CQS New City High Yield Fund
Limited
CQS New City High Yield Fund Limited
aims to provide investors with a high dividend yield and the
potential for capital growth by investing in high-yielding, fixed
interest securities. These include, but are not limited to,
preference shares, loan stocks, corporate bonds (convertible and/or
redeemable) and government stocks. The Company also invests in
equities and other income-yielding securities.
Since the Fund's launch in 2007, the
Board has increased the level of dividends paid every year. As at
31 December 2023, the Fund's dividend yield is 9.13%. In addition
to quarterly dividend payments, the Fund seeks to deliver investors
access to a high-income asset class across a well-diversified
portfolio with low duration to help mitigate interest rate
risk.
Further information can be found on
the Company's
website at https://ncim.co.uk/cqs-new-city-high-yield-fund-ltd/