Awdry: consumer staples are now fully valued

Charlie Awdry has been reducing exposure to consumer staples, previously a long-term theme on the £768m Gartmore China Opportunities fund.

The manager said the stocks are still attractive due to rising consumer spending but he now sees them as fully valued. “We are looking for earnings growth but there are high expectations from these companies. There are also rising input costs as sugar and palm oil are getting more expensive.” The fund was overweight consumer staples for a number of years but in the past quarter Awdry has reduced this to a neutral position. “Valuations are high relative to history and, although I do not think the sector is in a bubble as it has very good cashflow, these stocks have become the market...