Norway’s $1.4 trillion sovereign wealth fund, the world’s biggest, generated a 9.4 per cent return in the first half of the year after its investments in energy, finance and technology companies helped drive double-digit gains in its stock portfolio. Oslo-based Norges Bank Investment Management achieved almost 14 per cent return on stocks, with energy investments up nearly 20 per cent, it said. Investments in bonds and renewable energy infrastructure slipped, while real-estate holdings grew. The fund's total return, equivalent to roughly $110 billion, was marginally higher than that of the benchmark against which it measures itself. Chief executive Nicolai Tangen, a former hedge-fund manager, who has been running Norway’s giant sovereign investment vehicle for almost a year, has previously cautioned against expecting continued bumper returns. Earlier this week, he said that inflation is now emerging as the biggest threat to returns with both stocks and bonds potentially vulnerable. That’s amid an ongoing debate as to whether price growth is “transitory” or becoming more entrenched. US inflation has been above 5 per cent for the past two months, the highest in over a decade. “The strongest performance during the period was in sectors exposed more to inflation, such as energy, financials, materials, real estate and industrials,” the fund said. What’s more, “the highest returns shifted from growth stocks to value stock”. Since Mr Tangen started as chief executive, Norway’s wealth fund has spoken more publicly of a commitment to sustainability. The investor plans to step up the pace at which it offloads companies that pose a risk when viewed through an environmental, social or governance lens. It will also limit its exposure to emerging markets as part of the same strategy. Meanwhile, the fund has been pushing through a broader shift in its weighting to favour North America over Europe, in pursuit of higher returns. On Wednesday, it revealed a 16.8 per cent increase in the value of its technology holdings, which are dominated by stakes in Apple, Microsoft, Alphabet and Amazon. North American stocks returned 17 per cent in the first half, and made up 45.2 per cent of the equity portfolio. The fund’s equity portfolio represented 72.4 per cent of total assets at the end of June, which is slightly less than in the first quarter and shows the investor has already had to reduce its stock-market exposure to avoid straying too far from its 70 per cent mandate. Roughly five years ago, the fund was mandated to hold just 60 per cent in stocks. Created in the 1990s to invest Norway’s oil and gas revenues abroad, the fund delved into renewable infrastructure for the first time earlier this year. The move represents a landmark expansion of the list of the fund’s asset classes, which had been limited to stocks, bonds and real estate.