BlackRock International VI Fund Q2 2024 Commentary

Summary

• The fund posted a return of -1.34% (Class I shares) for the second quarter of 2024.
• During the quarter, the fund purchased Taiwan Semiconductor Manufacturing, Nintendo, AstraZeneca, Saint-Gobain, Teck Resources, and Julius Baer.
• The largest contributors to relative performance were Recruit, Tencent, and Novo Nordisk.

Average annual total returns (%) as of 6/30/24

2Q24 (not annualized)	YTD (not annualized)	1 Year	3 Years	5 Years	10 Years
Class I (Without Sales Charge) 1	-1.34	1.98	7.32	-4.52	6.09	3.96
Morningstar Foreign Large Blend Category Avg.	-0.07	5.16	10.30	1.52	5.82	3.76
MSCI EAFE 2	-0.42	5.34	11.54	2.89	6.46	4.33

Data quoted represents past performance and is no guarantee of future results. Investment returns and principal values may fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than that shown, which assumes reinvestment of dividends and capital gains. Insurance fees and charges are not included. Index performance is shown for illustrative purposes only. It is not possible to invest directly in an unmanaged index. Expenses for Class I shares: Total 1.18% ; Net, Including Investment Related Expenses (dividend expense, interest expense, acquired fund fees and expenses and certain other fund expenses) 0.87% ; Net, Excluding Investment Related Expenses 0.86% . Refer to (800)-441-7762 for the most recent month-end performance.

Commentary as of 06/30/24

• The fund posted a return of -1.34% (Class I shares) for the second quarter of 2024.
• The largest contributor to relative performance was an overweight exposure to the communication services sector. An overweight allocation to the health care sector performed well, as did an underweight position in the real estate sector. The largest detractors were the financials, information technology, and consumer discretionary sectors.
• During the quarter, the fund purchased Taiwan Semiconductor Manufacturing (TSMC), Nintendo ( OTCPK:NTDOY ), AstraZeneca ( AZN ), Saint-Gobain ( OTCPK:CODGF ), Teck Resources ( TECK ), and Julius Baer ( OTCPK:JBARF ). Among the sales, we took profits on Freeport-McMoRan ( FCX ), and sold the holdings in Vestas Wind Systems ( OTCPK:VWDRY ) and BBVA in Europe. We exited Lojas Renner ( OTCPK:LRENY ) and B3 in Brazil, as well as Smith & Nephew ( SNN ) and Remy Cointreau ( OTCPK:REMYF ).

Top 10 holdings (%)

Novo Nordisk Class B ( NVO )	6.55
Sony Group Corp ( SONY )	5.66
Beiersdorf Ag ( OTCPK:BDRFF )	5.24
Recruit Holdings Ltd ( OTCPK:RCRRF )	5.23
Deutsche Telekom N Ag ( OTCQX:DTEGF )	4.77
Tencent Holdings ( OTCPK:TCEHY )	4.74
Mastercard ( MA )	4.56
Canadian National Railway ( CNI )	4.55
ASML Holding ( ASML )	4.49
Taiwan Semiconductor Manufacturing ( TSM )	4.17

Contributors

The largest contributors to relative performance were Recruit, Tencent, and Novo Nordisk. Recruit's share price increased due to strong results and its commitment to return more cash to shareholders. Tencent benefited from the release of its long-awaited Dungeon & Fighter mobile game, which became a top seller in China. Novo Nordisk continued its strong performance, buoyed by further favorable data for its blockbuster weight-loss drug, Wegovy.

Detractors

The largest detractors were Lojas Renner, TSMC, and XP. Brazilian retailers such as Lojas Renner were impacted by "stronger-for-longer" interest rates in the United States and the subsequent re-pricing of rates expectations in Brazil. An underweight holding in TSMC weighed on relative returns. The stock performed strongly as revenue rose, driven by improving market conditions, booming demand for AI chips, and a better product cycle outlook from leading customer Apple. XP was affected by macroeconomic developments that led to weak performance.

Investment approach

The fund seeks current income and long-term growth of income and capital by investing primarily in equities of companies in developed countries outside the United States that fund management believes are currently undervalued by the market.

Further insight

We have seen some disappointing economic data across international markets, such as declining new order numbers, while some "bellwether" companies have reported weakness. At the same time, input cost inflation has continued to normalize. This aligns with our expectation of a global economic slowdown, though we do not foresee a recession. We continue to hold a focused portfolio with idiosyncratic earnings drivers to navigate this market environment.

Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.

This post originally appeared on BlackRock.

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