by Gwladys Fouche
ARENDAL, Norway (Reuters) – Norway’s sovereign wealth fund posted a profit of 1.501 billion crowns (131.1 billion euros) in the first half, thanks in particular to the growth of American technology companies and their development in artificial intelligence (AI).
The fund’s holdings in US tech soared 39% over the period, led by Apple, Microsoft and Nvidia, which generated an overall return of 10%.
The head of the sovereign wealth fund, Nicolai Tangen, told Reuters that the strong performance came as a surprise in “a rather worrying context”, with high inflation and geopolitical tensions.
It’s partly because AI has become a massively followed investment theme when it was previously seen as “something with potential,” said deputy director Trond Grande.
“We now see that potential materializing and being priced into the stock market valuations of these companies,” Trond Grande told Reuters.
Asked if he was worried about a possible crash in tech stocks, he said: “We are still aware and worried about the largest exposures in the fund. Today they are in the tech sector. that’s why we’re watching this very closely.”
Technology is the most represented sector in the Norwegian sovereign wealth fund’s equity investment, accounting for 11.9% of the portfolio at the end of 2022, according to data from the fund.
The sovereign wealth fund, which invests Norwegian state revenues from oil and gas production, owns an average of 1.5% of all listed shares worldwide. It also invests in bonds, unlisted real estate and renewable energy projects.
(Report Gwladys Fouche; written by Nerijus Adomaitis; Blandine Hénault for the French version, edited by Jean-Stéphane Brosse)
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