DB Today - Global/Macropg.jrj.com.cn/acc/Res/CN_RES/INVEST/2016/4/21/c46d02b0... · 2016-04-25 ·...

Deutsche Bank Group Markets Research

Global

Periodical

DB Today - Global/Macro

Date

21 April 2016

Thursday 21st April 2016

________________________________________________________________________________________________________________

Deutsche Bank Securities Inc.

Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1. MCI (P) 057/04/2016.

Amy Tan

Research Analyst

(+1) 212 250-5574

[email protected]

John Mcnamara

Equity Focus

(+1) 212 250-4727

[email protected]

Mairead Smith

Equity Focus

(+44) 20 754-71054

[email protected]

MACRO HIGHLIGHTS

Credit Strategy - Early Morning Reid - Jim Reid Performance for equity markets has been strong with the Stoxx 600 now up +4% which is a marked turnaround from -3% of two weeks ago. Regionally it's the DAX (+7%) which leads the way (and ahead of the S&P 500 which is up +6%), followed closely by the peripheral bourses of Portugal (+6%), Greece (+6%) and Spain (+5%) with the FTSE MIB (+3%) lagging behind. European banks have staged a huge turnaround of late also and are now positing a +2% gain, which is an +11% or so swing from two weeks ago. It won't come as much surprise to hear that EUR credit has continued to remain well supported with EUR HY (+4%), EUR IG Non-Fin (+2%) and EUR Fin Sub (+2%) all in low single digit return territory and out-performing bunds. That said it's interesting to see that EUR credit has generally underperformed its US counterparts by a percent or so, reflecting the lower energy exposure over a period of a large rally in Oil prices (WTI +11%). Details on page 7

Europe - Global Economic Perspectives - Peter Hooper In the past five years, US Labor productivity growth has plunged to its lowest rate in more than three decades. This development explains why the US labor market has been on such a robust improving trend in the face of a disappointingly sluggish recovery in GDP. Details on page 8

FX Strategy - FX Daily - George Saravelos Following last month's ECB and Fed meetings, we pushed our EUR/USD parity forecast out to the end of the year, anticipating a period of stability in coming months. We see small upside risks to the euro following the ECB press conference today but little to change our medium-term outlook. Details on page 9

Asia Strategy – India Equity Strategy - Abhay Laijawala Over the past one week, 2 leading international weather forecasting agencies (Australian Bureau of Meteorology and National Oceanic and Atmospheric Admnistration, USA) have issued a La Niña watch for 2016. Both state that the 2015 El Niño event – among the strongest on record – is moderating and the probability of a La Niña event is rising. The Bureau of meteorology in Australia has assigned a 50% probability to a La Niña occurrence. Extended and strong El Niño occurrences (like the one we saw last year and which had likely been the key reason for the Indian drought) have generally resulted in deficient Indian monsoons and sharp drops in agricultural production. Details on page 10 Cont’d on next page

GLOBAL MARKET WRAP

INDEX Close 1D YTD %Chg %Chg

S&P 500 2102.40 0.08 2.86

NASDAQ 4948.13 0.16 -1.18

DOW 18096.27 0.24 3.85

DJ STOXX 50 3154.51 0.38 -3.46

FTSE 100 INDEX 6418.82 0.13 2.83

HANG SENG INDEX 21543.86 1.45 -1.69

MSCI Asia ex Japan 512.01 -0.64 2.41

BRAZIL BOVESPA 53630.93 -0.15 23.72

RTS-2 INDEX 817.55 1.44 29.19

COMMODITY PRICES

COMMODITIES Close 1D YTD %Chg %Chg

West Texas 42.63 3.77 15.09

Brent 44.49 0.20 24.45

CRB 181.44 1.98 3.01

Copper 225.15 0.60 5.46

Gold (Spot) 1259.52 1.23 18.66

Alum. (LME) 1622.00 2.21 7.63

Baltic Dry 669.00 -0.30 39.96

FOREIGN EXCHANGE PRICES

FOREX (vs US$) Close 1D YTD %Chg %Chg

HK$ 7.76 -0.03 -0.09

EUR 1.13 0.11 4.16

JPY 109.53 0.28 9.76

GBP 1.44 0.15 -2.60

Source: Bloomberg Finance Lp

DERIVATIVES

Current %-ile Value Rank

SPX 3M Mat ATM-Strike Imp Vol 13.10 18.3

SPX 3M Mat 90%-110% IV Skew 9.02 0.0

SPX 3M Mat Realized Vol 15.62 41.9

Source: Bloomberg Finance Lp,

CREDIT

Credit Close 1D YTD %Chg %Chg

CDX.NA.IG 72.74 -4.04 -17.56

ITRX.Europe 69.64 -1.32 -9.63

CDX.NA.HY 103.67 0.29 2.40

ITRAX.XOVER 298.54 -1.80 -5.05

Source: Bloomberg Finance LP

21 April 2016



MACRO HIGHLIGHTS

Japan Strategy - Japan FI Morning Memo - Makoto Yamashita Trading activity by investor type in March shows notable end-FY purchases by the insurers in the superlong sector. The insurers purchased a net JPY743bn superlong JGBs in March, which was 2.6 times more than the average of JPY282.8bn for the 11 months through February FY15. Net buying probably swelled because the insurers had been waiting until end-FY15 for yields to rise. We expect the pace of net purchases has declined again from April. Agricultural, forestry, and fishery financial institutions also bought a net JPY430.1bn superlong JGBs. The city banks made overall net purchases of public bonds to the tune of JPY952.4bn. Net purchases of JPY368.6bn superlong JGBs were a stand out, but this likely also included buying for amortization; we doubt the city banks sharply built-up risk after not doing so in February. In addition, regional financial institutions reduced net purchases of superlong JGBs to JPY79.1bn (JPY335.4bn in February) Details on page 11

US Economics - US Daily Economic Notes - Joseph LaVorgna The breadth of economic performance is generally a measure of durability. In other words, if the economy is generating broad-based gains, growth is more likely to be sustained. This is because the economy would not be relying on just one or two sectors to drive growth. We remain extremely cautious on the near-term economic outlook because the projected Q1 slowdown in real GDP was likely relatively broad based: Consumption, investment spending, housing and net exports are all anticipated to have slowed relative to their Q4 2015 growth rates. Unlike Q1 2015, when most of the weakness in output was due to a plunge in net exports that resulted from the West Coast port slowdown, there are no such excuses this year. In fact, the weather has been much better this year, as well. In the first quarter of 2014 and 2015, record cold temperatures afflicted much of the Midwest and Northeast, and could have weighed on factory sector output. Recall that many shipping lanes across the Great Lakes were frozen. If anything, this year's more "normal" weather conditions should at the margin have been a mild positive for growth. Instead, it appears the economy expanded by only 0.5% last quarter, which is extremely disappointing given the fact that output grew only 1.4% in the quarter before. Details on page 12

21 April 2016



KEY COMPANY RESEARCH

ASIA Apple Inc. (AAPL.OQ),USD107.13 Hold Price Target USD105 Sherri Scribner: We remain focused on the long-term fundamentals for Apple, which suggest top-line growth will be more challenging going forward. While we acknowledge many will likely buy the stock on the "anticipation trade" into the iPhone 7 launch this year, we see slower smartphone sales, lack of growth at the high end, limited market share penetration in emerging markets, and elongating smartphone refresh cycles as key inhibitors to Apple's growth longer term. With valuation currently reflecting long-term growth challenges, balanced by expectations for a trade into the iPhone 7 launch, we view shares as fairly valued and maintain our Hold. Details on page 13 Asia FX Strategy Notes Perry Kojodjojo: The key takeaways are that the authorities are comfortable keeping the USD/CNY relatively stable for the time being, so as to (1) restore stability in order to calm market nerves about CNY depreciation, and (2) discourage further capital outflows. Given the new-found stability, China is unlikely to introduce more direct measures to manage flows, including a Tobin tax. Even if outflows pick up, the message we have is that a Tobin tax is not the first port of call for regulators. In the medium term, however, the authorities would still allow the CNY to weaken during a period of USD strength, albeit at a more gradual depreciation pace. This is to ensure that the RMB is not overvalued against the basket, and, given that corporates are a more appropriate hedge than before, some RMB flexibility can be permitted. The timing of this is tricky, since the RMB is very much a policy-driven currency. Most people with whom we have spoken expect the USD/CNY to remain relatively stable in 2Q and depreciation to resume only in 2H, when the USD outlook starts to turn, as the Fed resumes rate hikes. Given that the authorities are likely to manage RMB actively and that the USD outlook seems benign, we have closed our USD/CNH 6M call spread. Details on page 14 LATIN AMERICA Latam Airlines Mar Q 2016 Preview Michael Linenberg: We are projecting our Latam airline coverage universe to generate an operating profit of $405 mm in the Mar Q, which represents a 22.7% decline from the prior year. While fuel expense is estimated to fall 30.8% or $519 mm from a year ago, we are forecasting that the fuel tailwind will be more than offset by the decline in top-line (expecting a 12.5% or $795 mm decrease) as FX and a weak macro backdrop continue to pressure fares. In that regard, we project the industry’s yield (average fare per mile) to fall 17.6% y-o-y, representing a $1 bb headwind to industry profits, driven in large part by weak. Details on page 15 SOUTH AFRICA Bidvest (BVTJ.J),ZAR372.16 Hold Price Target ZAR358 John Kim-Sa: Buy to hold, tgt ZAR374 to ZAR358. Bidvest operates a diversified business model: while five of its 12 divisions account for c.70% of group profit, we highlight the diverse nature of these five major divisions. Collectively, Bidvest operates a mix of defensive business models that function in lower-growth economic conditions. We estimate that c.40% of group earnings come from non-rand currencies, providing a rand hedge. The challenge will be how the enterprise value evolves in the face of a separate Foodservice listing, raising the question of how the combination of other businesses could trade on a stand-alone basis; we move from Buy to Hold. Details on page 16 NORTH AMERICA Integrated Oils and Refiners

Ryan Todd: With crude oil balances likely to tighten through 2H16, and sentiment largely shifting constructive on both crude and the equities, we expect the market to look through what is likely to be a trough in qtrly results (high capex, low commodity), instead focusing on relative positioning into 2017 and the pace/magnitude of potentially increasing activity. Although we anticipate an emphasis on continued fiscal discipline, we expect signs of first-mover efforts by top-tier balance sheet/resource quality names (PXD) and an early road map into recovery for others. We favor quality multi-year outperformers (PXD, OXY), higher oil leverage plays (DVN, MRO, COP), and downgrade EOG to Hold. Details on page 17

21 April 2016



TODAY’S HEADLINES

Markets: Crude rebound continues as EIA says US output falls to Oct ’14 low last week, lifts equity markets in Europe/US, bond yields rise, iron ore rally continues. Asian equities (ex China) post solid gains early Thursday.

USA: Existing home sales rebound 5.1% mom to 5.33m saar in March, above mkt

USA: MBA new purchase mortgage applications falls 0.5% last week.

CAN: Wholesale sales fall 2.2% mom in February, below mkt.

UK: Employment rises 20k in 3mths to February, below mkt, ILO unemployment steady at 5.1%. Average earnings rise 1 8% yoy in 3mths to February, below mkt.

DEU: PPI flat in March, down 3.1% yoy.

CHE: CS ZEW expectations index rises 8pts to 11.5 in April.

BEL: Consumer Confidence Index falls 1pt to -8 in April.

NZL: Tourist arrivals rise 13.8% yoy in March.

NZL: ANZ job ads index rises 2.9% mom in March, up 4.9% yoy.

NZL: ANZ-Roy Morgan consumer confidence index rises 2pts to 120.0 in April.

AUS: NAB business confidence index falls 1pt to 4 in Q1.

THE DAY AHEAD.

USA: Initial Jobless Claims, Philadelphia Fed manufacturing survey (Apr), FHFA House Price Index (Feb), Conf. Board

Leading Index (Mar), Bloomberg Consumer Comfort Index

EMU: ECB policy announcement, Consumer Confidence (Apr A)

UK: Public Finances (Mar), Retail Sales (Mar)

FRA: Business Confidence (Apr)

ESP: Trade Balance (Feb)

CHE: Trade Balance (Mar), M3 (Mar)

SWE: Riksbank rate announcement

DNK: Consumer Confidence Indicator (Apr), Retail Sales (Mar)

Source: Extract from DB Daily published on 21 April 2016

21 April 2016



Forecast G7 Quarterly GDP growth

% qoq saar/annual: % yoy

Q1 15 Q2 15 Q3 15 Q4 15F Q1 16F Q2 16F Q3 16F Q4 16F 2015F 2016F 2017F

US 0.6 3.9 2.0 1.4 0.5 1.0 1.2 2.4 2.4 1.4 2.2

Japan 4.6 -1.4 1.4 -1.1 -1.4 -0.7 0.8 1.5 0.5 -0.4 0.5

Euroland 2.3 1.6 1.2 1.3 1.5 1.4 1.8 1.8 1.5 1.5 1.5

Germany 1.6 1.6 1.1 1.1 1.8 1.4 2.1 2.1 1.7 1.7 1.6

France 2.6 0.2 1.5 1.3 1.1 1.1 1.4 1.8 1.2 1.2 1.5

Italy 1.7 1.2 0.8 0.4 1.3 1.3 1.4 1.0 0.8 1.1 1.1

UK 1.8 2.4 1.8 2.4 2.4 2.4 2.4 2.4 2.3 2.2 2.2

Canada -0.9 -0.4 2.4 0.8 1.7 2.0 2.3 3.0 1.2 1.8 2.5

G7 1.5 2.2 1.7 1.0 0.7 1.0 1.4 2.2 1.8 1.2 1.8 a) Euroland forecasts as at the last forecast round on 01/04/16. Bold figures signal upward revisions, bold, underlined figures signal downward revisions. (b)GDP figures refer to working day adjusted data, except Germany. (c) HICP figures for euro-zone countries and the UK (d) Current account figures for Euro area countries include intra regional transactions. e) The world aggregate has been calculated based on the IMF weights released in October 2015. Sources: National authorities, Deutsche Bank Research Data updated from Global Economics Perspective note published on 20 April 2016

Commodities: Energy Commodities & Precious Metals Price Forecasts

USD Q4 15 2015 Q1 16 Q2 16 Q3 16 Q4 16 2016 Q1 17 Q2 17 Q3 17 Q4 17 2017 2018

WTI (bbl) 43.6 49.2 33.0 40.0 43.0 47.0 40.8 50.0 50.0 54.0 54.0 52.0 65.0

Brent (bbl) 46.5 54.2 33.0 42.0 45.0 50.0 42.5 53.0 53.0 57.0 57.0 55.0 70.0

US Natural Gas (mmBtu)

2.30 2.66 1.95 2.20 2.35 2.50 2.25 2.65 2.73 2.61 3.01 2.75 3.30

Gold 1104 1161 1230 1150 1170 1230 1195 1250 1175 1210 1290 1231 1275

Silver 14.8 15.7 15.5 15.0 14.9 15.2 15.2 16.0 15.0 15.5 16.5 15.8. 16.5

Aluminium

USc/lb 67.8 75.5 69.9 70.8 69.4 69.0 69.8 70.3 71.7 73.5 74.0 72.4 77.1

USD/t 1494 1664 1540 1560 1530 1520 1538 1550 1580 1620 1630 1595 1700

Copper

USc/lb 221.9 250.1 212.1 222.3 204.2 199.6 209.6 204.2 208.7 217.8 226.9 214.4 237

USD/t 4890 5512 4675 4900 4500 4400 4575 4500 4600 4800 5000 4725 5223 Source: Deutsche Bank, Figures are period averages

CENTRAL BANK POLICY (%)

Current Q2-16F Q416F Q4-17F

US 0.375 0.375 0.625 1.625

Eurozone 0.00 0.00 0.00 0.00

Japan -0.10 -0.10 -0.20 -0.20

UK 0.50 0.50 0.75 1.25

China 1.50 1.50 1.25 1.25

India* 6.75 6.50 6.50 6.50 Source: The House View published on 19 April 2016 * Updated from the House View published on 16 March 2016

21 April 2016



FORECAST

FOREIGN EXCHANGE RATES Vs US Dollar vs. Euro

Countries Current Jun16 Sep 16 Dec 16 Current Jun16 Sep 16 Dec 16

United States - - - - 1.13 1.06 1.00 0.85

Japan 109.66 105 109 112 122 111 112 112

Euroland 0.89 0.94 0.97 1.00 - - -

United Kingdom 0.70 0.73 0.75 0.78 0.79 0.77 0.77 0.78

Switzerland 0.97 1.05 1.09 1.12 1.09 1.11 1.12 1.12

Canada 1.26 1.40 1.42 1.43 1.43 1.48 1.46 1.43

China 6.48 6.73 6.86 7.00 7.32 7.13 7.07 7.00

India 66.25 68 68 68 74.83 72 70 68 * Sources: Deutsche Bank, Bloomberg, Datastream. Data last updated form ‘Macro Forecasts’ report published on 19 April 2016 Current rates taken from Bloomberg Finance Lp

GOVERNMENT RATES Current Q2-16F Q4-16F Q4-17F

US 10Y yield 1.85 1.75 1.75 1.75

EUR 10Y yield 0.20 0.20 0.45 1.10 Source: The House View published on 19 April 2016 *Current Rates taken from Bloomberg Finance Lp

INDEX FORECASTS Current* 2015

DJ Stoxx 600 350.75 390

FTSE 100 6410.26 NA

Dax 600 10421.29 NA

MSCI AC World 409.05 NA

S&P 500 2102.40 2050

Source: : The Equity View published on 13 November 2015

*Current Rates taken from Bloomberg Finance Lp

CORPORATE ACCESS

UPCOMING CONFERENCES/TRIPS/EVENTS

Date Conferences

May 4-5, 2016 41st Annual Health Care Conference@ Boston

May 4-5, 2016 db Access Andean Region Conference@ London

May 10, 2016 MLP, Midstream, and Natural Gas Conference @ New York

May 18, 2016 dbAccess Italy Conference @ London

May 19, 2016 dbAccess UK Housebuilders Day @ London

May 19, 2016 9th Annual Semiconductor One-on-One Conference @ San Francisco

May 23-27, 2016 dbAccess Asia Conference @ Singapore Source: Deutsche Bank For more details log on to www.conferences.db.com

21 April 2016



Early Morning Reid Macro Strategy

Welcome to ECB meeting day, 6 weeks on from Draghi's policy bazooka. In the PDF today we've updated our

performance review chart to track global assets since this point. Of particular interest to us is where European assets

are in the mix. When we last ran this nearly two weeks ago returns for European assets had been relatively weak

post-ECB with many of the areas of the market Draghi had tried to help having underperformed. The last 14 days

have seen a marked turnaround in sentiment however and now all of the European assets we look at are back in

positive territory over the relative time frame. In bond markets Bunds have returned just shy of 1% with Spanish

bonds now catching up and matching on a total return basis. BTP's are just in positive territory (+0.3%) but have

underperformed with the Italian banking concerns. Performance for equity markets has been strong with the Stoxx

600 now up +4% which is a marked turnaround from -3% of two weeks ago. Regionally it's the DAX (+7%) which

leads the way (and ahead of the S&P 500 which is up +6%), followed closely by the peripheral bourses of Portugal

(+6%), Greece (+6%) and Spain (+5%) with the FTSE MIB (+3%) lagging behind. European banks have staged a huge

turnaround of late also and are now positing a +2% gain, which is an +11% or so swing from two weeks ago. It

won't come as much surprise to hear that EUR credit has continued to remain well supported with EUR HY (+4%),

EUR IG Non-Fin (+2%) and EUR Fin Sub (+2%) all in low single digit return territory and out-performing bunds. That

said it's interesting to see that EUR credit has generally underperformed its US counterparts by a percent or so,

reflecting the lower energy exposure over a period of a large rally in Oil prices (WTI +11%).

Perhaps of most interest to us today will be evidence of any logistical progress on the corporate bond purchasing

program (CSPP). Since the announcement date details for the program have been thin with the hope that today will

bring greater clarity around the potential size, split between primary and secondary markets and the finer details

around bond eligibility. It might still be too early to hear much though. A report from Michal Jezek in my team, which

we attach the link below to, shows that ECB eligible eurozone bonds initially outperformed post the ECB CSPP

announcement and in the two weeks or so after. However since then they have underperformed non-eurozone bonds

almost to the same magnitude. The turnaround has coincided with a higher beta global rally over the last two weeks

or so, so that's certainly helped the performance of the generally wider higher beta non-eurozone issues. We also

provide a list of the top and bottom 100 bonds by performance since the ECB announcement. See the report here for

more details. http://pull.db-gmresearch.com/cgi-bin/pull/DocPull/12462-B2E8/8583478/DB_Update_2016-04-

21_0900b8c08b0b6f5d.pdf

Outside of the ECB today the main topic for markets continues to be Oil which is clearly the dominant driver for price

action at the moment. Last night saw WTI close +3.77% at $42.63/bbl and so eclipsing the highest price for the year.

That means Oil is now just over +13.5% up from the post-Doha early Monday morning lows now, or nearly $5. It's

worth noting that we roll onto the June contract today which is currently trading around $44/bbl this morning (and

unchanged). Yesterday the early concerns from the announcement of the end of the Kuwait oil strike was quickly

forgotten about post the latest EIA data which showed inventory levels coming in lower than expected and which

appeared to be enough to fuel the rally. Later on we also saw headlines filter through suggesting that OPEC and other

crude producers could meet as soon as next month in Russia in a bid to restart production freeze talks according to

Iraq's deputy oil minister.

Jim Reid (+44) 20 754-72943

[email protected]

21 April 2016



Global Economic Perspectives

Productivity down, participation up: US labor market improving

In the past five years, US Labor productivity growth has plunged to its lowest rate in more than three decades. This

development explains why the US labor market has been on such a robust improving trend in the face of a

disappointingly sluggish recovery in GDP.

The most important driver of this productivity slowdown appears to have been the weak recovery in business

investment, driven most likely by uncertainty about economic prospects. This picture is unlikely to improve enough to

give a significant boost to productivity growth any time soon.

This prospect augurs for continued strong growth in employment, which we expect will remain in the vicinity of 200k

per month if consensus (and FOMC) GDP growth projections are realized, and would mean substantial further

tightening of the labor market were it not for the recent rise in labor force participation. The participation rate could

rise slightly further in the near term, enough to keep unemployment from falling below the FOMC’s median projection

this year even if productivity growth stays extremely low.

But as we look beyond 2016, as labor force participation returns to a declining trend, the labor market will tighten

substantially further on consensus growth expectations (with unemployment falling well below 4%) unless

productivity growth picks up dramatically. The tightening labor market may induce firms to begin to spend more to

raise productivity, but that process will take time.

In the meantime, the bottom-line implications of our analysis for Fed policy are that the FOMC should have the luxury

of moving cautiously this year. However, in 2017, if the economy develops along the lines of the FOMC’s median

growth projection, the labor market is likely to tighten substantially faster than the Committee anticipates. This will

call for a more aggressive policy path than currently envisioned in the dots.

Peter Hooper (+1) 212 250-7352

[email protected]

21 April 2016



FX Daily Updated EUR/USD thoughts

Following last month's ECB and Fed meetings, we pushed our EUR/USD parity forecast out to the end of the year,

anticipating a period of stability in coming months. We see small upside risks to the euro following the ECB press

conference today but little to change our medium-term outlook.

First, despite recent Fed dovishness, the real rate differential between Europe and the US is not signaling a large

divergence in FX versus monetary policy expectations. EUR/USD "fair value" is a little above 1.15 on rate differentials,

suggesting small upside risks post a "no news" ECB day. To change our medium-term euro view, we would need to

agree with current market pricing, that the Fed is on hold this year. We don't: one or two hikes seems more

reasonable.

Second, the underlying flow picture – our Euroglut thesis – is not changing either. Updated portfolio flow data

released this week show that the relentless fixed income outflows from Europe continue at full speed, currently

running at an annualized half a trillion euros (chart 2). There is little to suggest that hedging behaviour on these flows

should be changing either: 1-yr euro cross-currency basis is reasonably stable, in contrast to Japan where the cost

has more than doubled in recent months.

Finally, we don't think that the medium-term dollar bull trend is over. The recent dollar correction is not unusual for

medium-term cycles (chart 3). And medium-term tops only happen when the dollar turns into a low-yielding currency.

The greenback is currently a mid-yielder – and is still on track for higher, not lower, yield rankings by the end of the

year.

George Saravelos (+44) 20 754-79118

[email protected]

21 April 2016



India Equity Strategy Rising likelihood of La Niña: positive surprises ahead

Likelihood of La Niña event in 2016 has risen with two global weather agencies issuing a La Niña watch

Over the past one week, 2 leading international weather forecasting agencies (Australian Bureau of Meteorology and

National Oceanic and Atmospheric Admnistration, USA) have issued a La Niña watch for 2016. Both state that the

2015 El Niño event – among the strongest on record – is moderating and the probability of a La Niña event is rising.

The Bureau of meteorology in Australia has assigned a 50% probability to a La Niña occurrence. Extended and strong

El Niño occurrences (like the one we saw last year and which had likely been the key reason for the Indian drought)

have generally resulted in deficient Indian monsoons and sharp drops in agricultural production. Conversely La Niña

occurrences have led to bountiful rainfall and large above average increases in agricultural GDP growth rates which

have translated into above average GDP growth rates as well. In order to alleviate rural distress, India needs bountiful

rainfall, with proper spatial and temporal distribution. Consequently, a La Niña event could provide a major boost to

consumption, investment and GDP growth.

Analysis of >30 year data indicates strong positive correlation between La Niña and India’s key macro/rural indicators

While the El Niño is expected to moderate by the end of May by most weather forecasters, the timing of the onset of

La Niña is still uncertain. Most forecasters predict that this is likely to set in around Aug-Sept. This may likely lead to

above average rainfall during the latter part of the monsoon season. Given the historically strong positive correlation

between La Niña years and India’s GDP/agri dependent/rural sectors, we have analyzed more than 30 years (since

1980-81) of monsoon data and associated key economic indicators to assess the impact of La Niña. We arrive at the

following conclusions:

Bountiful rainfall in La Niña years: Average annual rainfall in La Niña years (officially identified by the

government - FY89, FY99, FY00, FY08 & FY11) has been 5.3% above long term average vs. a mean of 4.6%

below long term average in non-La Niña years. The Indian Meteorological Department has forecasted 2016

monsoon rainfall to be 106% of long term average assigning 94% probability to normal or above rainfall.

Robust performance of rural economy: Consequently, rural economy has also posted strong growth during La

Niña years. For e.g. Agri GDP in La Niña years grew at an average 7.8% yoy vs. an average of 2.3% yoy in non

La Niña years. In the past 2 years agri GDP growth has averaged an anemic 0.4% yoy on account of an El-

Nino influenced drought.

Food grain production growth in La Niña years averaged 9.6% yoy compared to an average 1.2% yoy in non

La Niña years. We also note that the positive impact of La Niña is amplified further if it is preceded by an El-

Nino year, a situation similar to the current year. Based on long term data of El Niño and La Niña events, there

is significant statistical evidence of strong El Niños being followed in quick succession by a La Niña.

Abhay Laijawala (+91) 22 7180 4031

[email protected]

21 April 2016



Japan FI Morning Memo Superlong sector likely to lack sellers in April

Superlong sector likely to lack sellers in April

Trading activity by investor type in March shows notable end-FY purchases by the insurers in the superlong sector.

The insurers purchased a net JPY743bn superlong JGBs in March, which was 2.6 times more than the average of

JPY282.8bn for the 11 months through February FY15. Net buying probably swelled because the insurers had been

waiting until end-FY15 for yields to rise. We expect the pace of net purchases has declined again from April.

Agricultural, forestry, and fishery financial institutions also bought a net JPY430.1bn superlong JGBs. The city banks

made overall net purchases of public bonds to the tune of JPY952.4bn. Net purchases of JPY368.6bn superlong

JGBs were a stand out, but this likely also included buying for amortization; we doubt the city banks sharply built-up

risk after not doing so in February. In addition, regional financial institutions reduced net purchases of superlong

JGBs to JPY79.1bn (JPY335.4bn in February). They moved to net purchases of superlong JGBs when NIRP was

introduced and then appear to have reduced net buying due to the sharp fall in yields. However, the fact that they did

not become net sellers suggests they moved expecting a continued decline in yields. International Transactions in

Securities data shows foreigners sold a net JPY1.6trn long-term debt securities due to large redemptions in March.

Trading activity by investor type showed foreigners were net buyers overall (because redemptions are not included),

with net sales in the superlong sector but large net purchases of JPY1.4trn intermediate bonds. Buying based on a

widening of the USD/JPY basis swap spread continued to be concentrated mainly in intermediate JGBs. Domestic

investors do not seem to have built up sufficient JGB holdings, and some investors seem to be holding back from

selling, such as regional financial institutions. We think conditions continue to weigh on yields with a lack of sellers

and the BoJ's JGB purchases working to tighten supply/demand. The question is when domestic investors will move

to take profits. Our focus is May partly because yields are currently still declining.

Today's JGB market forecast: yields to have a downward bias due to smooth 20y auction

JGB yields continued to decline yesterday. The superlong sector led the fall in yields, possibly due to buying in

anticipation of a decline in yields following the 20y JGB auction. The 20y, 30y, and 40y yield fell to record lows of

0.245%, 0.285%, and 0.29%. Overseas markets were risk on yesterday, with a rally in oil prices, rise in stocks, fall in

USTs, and dollar appreciation. We expect JGB yields to have a downward bias today due to a smooth result to the

20y auction. We recommend buying at the 20y JGB auction from an immediate-term perspective. The auction

schedule is unusual because the long Golden Week holiday this year in April-May means if the 20y JGB auction is

smoothly absorbed the next 30y auction is not for another three weeks. With zero percent likely a bottom for the 20y

yield, in the immediate term we recommend buying at the auction and then selling at the BoJ's JGB purchase

operations. The JPY100bn reduction in 20y issuance to JPY1.1trn seems to provide a reason to buy, but the BoJ will

reduce the amount of its JGB purchases by a similar amount. Over the medium term, we recommend buying on dips

through issuance in May or from a 20y yield of above 0.5%. This is because we expect yields could rebound in May

to the extent of the supply/demand led decline. The media has reported that double elections appear to be off the

table, but we still see a high likelihood that the consumption tax hike will be delayed. Considering the impact of the

earthquakes in Kumamoto, taking the issue of postponing the hike to the Upper House election will probably be

accepted.

One-month outlook: We expect yields to have a downward bias through Golden Week due to numerous buying

catalysts such as expectations for tighter supply/demand and easing by the BoJ. However, we anticipate a rebound

in May so recommend trying to ride the yield wave. Over the medium-term, we recommend buying the 20y on dips

from 0.5% in the superlong sector

Makoto Yamashita (+81) 3 5156-6622

[email protected]

21 April 2016



US Daily Economic Notes Gains in the LEI might be deceptive

Commentary for Today: The breadth of economic performance is generally a measure of durability. In other words, if

the economy is generating broad-based gains, growth is more likely to be sustained. This is because the economy

would not be relying on just one or two sectors to drive growth. We remain extremely cautious on the near-term

economic outlook because the projected Q1 slowdown in real GDP was likely relatively broad based: Consumption,

investment spending, housing and net exports are all anticipated to have slowed relative to their Q4 2015 growth

rates. Unlike Q1 2015, when most of the weakness in output was due to a plunge in net exports that resulted from

the West Coast port slowdown, there are no such excuses this year. In fact, the weather has been much better this

year, as well. In the first quarter of 2014 and 2015, record cold temperatures afflicted much of the Midwest and

Northeast, and could have weighed on factory sector output. Recall that many shipping lanes across the Great Lakes

were frozen. If anything, this year's more "normal" weather conditions should at the margin have been a mild positive

for growth. Instead, it appears the economy expanded by only 0.5% last quarter, which is extremely disappointing

given the fact that output grew only 1.4% in the quarter before.

More troubling to us than the expected weakness in Q1 2016 real GDP is the diminishing breadth of gains in the

composite of leading economic indicators (LEI). In the chart below, we show the three-month moving average of the

diffusion index of the LEI, because the data can be volatile. Incidentally, data for March are released this morning.

While we are projecting a 0.3% increase in the March LEI, most of that gain will be attributable to the rising stock

market. Therefore, the decline in breadth may continue. We can see from the chart that breadth has been declining:

In February, only four out of the 10 series contributed positively to the LEI (jobless claims, new consumer goods

orders, yield curve and leading credit index); five series made a negative contribution (ISM new orders, nondefense

capital goods orders, building permits, stock prices and consumer expectations) and one series (average workweek)

had no impact on the LEI because its reading was unchanged. Notice, too, that breadth in the LEI tends to peak well

before the onset of recession. For example, prior to the 2001 and 2007 downturns, the three-month moving average

of the diffusion index was 23% and 27%, respectively. Consequently, we should be on guard for sub-30% readings.

Joseph Lavorgna (+1) 212 250-7329

[email protected]

21 April 2016



Apple Inc. Hold Reuters: AAPL.OQ Exchange: NSM Ticker: AAPL

“Anticipation” trade doesn’t trump long-term fundamentals

Price (USD) 107.13

Price target 105.00

52-week range 132.65 - 93.42

Market cap (USDm) 583,491.9

Shares outstanding (m) 5,446.6

Free float (%) 100

Volume (20 Apr 2016) 5,343,661

S&P 500 INDEX 2,102.40

FYE 9/30 2015A 2016E 2017E

1Q EPS 3.06 3.28A 3.47

2Q EPS 2.33 1.99 2.19

3Q EPS 1.85 1.90 2.12

4Q EPS 1.96 1.98 2.20

FY EPS (USD) 9.22 9.18 10.00

P/E (x) 12.9 11.7 10.7

Slower smartphone growth and elongating refresh cycles remain headwinds

We remain focused on the long-term fundamentals for Apple, which suggest top-

line growth will be more challenging going forward. While we acknowledge many

will likely buy the stock on the "anticipation trade" into the iPhone 7 launch this

year, we see slower smartphone sales, lack of growth at the high end, limited

market share penetration in emerging markets, and elongating smartphone refresh

cycles as key inhibitors to Apple's growth longer term. With valuation currently

reflecting long-term growth challenges, balanced by expectations for a trade into

the iPhone 7 launch, we view shares as fairly valued and maintain our Hold.

Developed country sales slowing, emerging markets focused on price

The smartphone market is expected to see single-digit growth this year, as most of

the developed markets are now near saturation. In addition, with more transparency

on the cost of new phones, particularly in the U.S., carrier data suggests refresh

cycles are elongating, which will put pressure on growth in developed markets.

While there are still new buyers in emerging markets, these markets are highly

focused on cost, as disposable income in China and India is substantially below that

of the U.S. and Europe. In China, more than 70% of the market is for phones priced

below $300, while in India, four-fifths of smartphones sold cost less than $150. We

expect this price sensitivity to limit Apple’s ability to gain share in these markets

given their high price points.

Still unclear if recurring revenue streams will drive growth

While Apple’s Services segment (9% of sales) is generally a recurring revenue

stream, the remaining 91% of Apple’s sales are in decline or seeing slower growth.

Despite the roll out of new Services offerings like Apple Pay and Apple Music,

average annual sales per device of $17 declined by 10% Y/Y in FY-15. Without

clearer evidence that Apple can increase per device sales, and given its small size,

we believe Services is unlikely to be a major growth driver.

Expect shares to trade at a discount, similar to other S&P 500 giants

Our analysis of the largest company in the S&P 500 suggests that companies with

more than a 3% index weight trade at a roughly 20% discount to the market’s

forward P/E multiple. As a result, we expect Apple shares will likely be capped at

around 13x forward earnings, which is their average P/E since 2010. Positive risks:

stronger-than-expected smartphone sales, share gains, and higher margins.

Negatives: slower smartphone sales, market share losses.

(Published on 20 April 2016)

Sherri Scribner (+1) 212 250-5734

[email protected]

21 April 2016



Asia FX Strategy Notes RMB: Trip notes

The key takeaways are that the authorities are comfortable keeping the USD/CNY relatively stable for the time being,

so as to (1) restore stability in order to calm market nerves about CNY depreciation, and (2) discourage further capital

outflows. Given the new-found stability, China is unlikely to introduce more direct measures to manage flows,

including a Tobin tax. Even if outflows pick up, the message we have is that a Tobin tax is not the first port of call for

regulators. In the medium term, however, the authorities would still allow the CNY to weaken during a period of USD

strength, albeit at a more gradual depreciation pace. This is to ensure that the RMB is not overvalued against the

basket, and, given that corporates are a more appropriate hedge than before, some RMB flexibility can be permitted.

The timing of this is tricky, since the RMB is very much a policy-driven currency. Most people with whom we have

spoken expect the USD/CNY to remain relatively stable in 2Q and depreciation to resume only in 2H, when the USD

outlook starts to turn, as the Fed resumes rate hikes. Given that the authorities are likely to manage RMB actively

and that the USD outlook seems benign, we have closed our USD/CNH 6M call spread.

Takeaways

We visited Beijing last week to discuss with policymakers, think tanks and economic observers what they thought

about the recent stability of the RMB, the flow dynamic in the onshore market, the likely path of the RMB ahead, and

whether China would continue to liberalise its capital account. Here are our key takeaways.

RMB steady as she is…for now. For the time being, in an environment of a more benign USD outlook and outflows

becoming increasingly more manageable, the authorities are comfortable keeping the USD/CNY relatively stable. The

goals here are to (1) restore stability in order to calm market nerves about CNY depreciation, and (2) discourage

further capital outflows, which have been sizeable over the last few months. We estimate that, since August, China

has experienced about ~$640bn of FX outflows (Figure 1). Although most agreed that the majority of the outflows

were due to (1) the repayment of FX liabilities, and (2) the accumulation of FX deposits in order to manage/hedge

future payments (Figure 2), there is a concern that further CNY depreciation could have resulted in domestic

individuals/corporate becoming more active in converting their domestic assets into foreign assets − particularly

wealthier individuals. Why? Because of (1) a possible loss of confidence in the government’s ability to manage the

financial system, particularly given the poor management of the equity market in the last few months, and (2)

preserving wealth. It is also possible that, without stabilising CNY expectations, the CNY-CNH basis will continue to

widen, and could be viewed as China breaching the IMF regulation on ‘multiple currency practice’. This is something

we do not think China wants to be seen doing, particularly ahead of CNY inclusion into the SDR basket in October

2016.

Perry Kojodjojo (+852 ) 2203 6153

[email protected]

21 April 2016



Latam Airlines Mar Q 2016 Preview

Top-line declines continue to drive profits lower

Top-line declines continue to outpace fuel tailwinds

We are projecting our Latam airline coverage universe to generate an operating profit of $405 mm in the Mar Q,

which represents a 22.7% decline from the prior year. While fuel expense is estimated to fall 30.8% or $519 mm

from a year ago, we are forecasting that the fuel tailwind will be more than offset by the decline in top-line

(expecting a 12.5% or $795 mm decrease) as FX and a weak macro backdrop continue to pressure fares. In that

regard, we project the industry’s yield (average fare per mile) to fall 17.6% y-o-y, representing a $1 bb headwind

to industry profits, driven in large part by weak

FX/macroeconomic conditions (with key Latam economies in recession).

Raising earnings estimates for several carriers

Our Mar Q operating profit forecast is slightly improved from $371 mm previously, driven by higher estimates for

several carriers partially offset by a reduced Aeromexico forecast (see Figure 6). While our operating profit

forecast for the seasonally strong Mar Q is better-than-expected, our FY 2016 operating profit forecast of $1.5 bb

remains unchanged as we expect revenue trends in seasonally weaker periods to be worse than previously

estimated.

We expect only the two Mexican carriers to generate margin expansion

Among our coverage universe of six Latam names, we expect only AEROMEX and VLRS to generate operating

margin expansion of 0.3 pp and 4.7 pp, respectively. We estimate that the industry’s operating margin will decline

1.0 pp to 7.2%.

Brazilian loyalty programs earnings growth expected to continue

We expect the earnings growth experienced at Smiles and Multiplus in 2015 to continue in the March quarter and

2016 despite the macro headwinds facing the Brazilian consumer (i.e. FX volatility, contracting GDP, high

unemployment, high inflation, etc.). Despite our positive outlook for Smiles we are of the view that its shares will

trade “in sympathy” with GOL until its airline partner sees a more stable market backdrop, which underpins our

Hold rating on the stock (Mulitplus shares remain Buy-rated).

VLRS remains top pick; downgrading CPA to Sell

While all of our Latam airline stocks have appreciated year-to-date as emerging market indices have traded up

(e.g. the Brazilian Bovespa and Mexican Bolsa are up 24% and 7% year-to-date in local currency terms,

respectively), we continue to favor the Mexican carriers given the strength of the domestic market. We continue

to rank VLRS as our top pick given the successful execution of its ultra low cost carrier model (“ULCC”) across its

growing network. Our order of preference is VLRS, AEROMEX, and AVH. We are lowering our rating on CPA from

Hold to Sell due to our reduced earnings outlook for 2016 (EPS of $4.95 goes to $4.40, see more details on Page

4). Our Hold-rated stocks are GOL and LATAM.

Valuation and risks

On an EV/EBITDAR basis, Latam airlines are trading at 7.8x and 7.1x our 2016 and 2017 forecasts, respectively

(compared to the group’s historical trading range of 6x - 8x). Fuel price volatility is a key risk for the group

In this report, we downgrade Copa Holdings to Sell. We also adjust target prices and EPS estimates for many

companies in our Latam coverage universe.

Michael Linenberg (+1) 212 250-9254

[email protected]

21 April 2016



Bidvest Hold Reuters: BVTJ.J Exchange: JNB Ticker: BVTJ

Buy to hold, tgt ZAR374 to ZAR358. Highlights from Circular; review of Foodservice

Price (ZAR) 372.16

Price target (ZAR) 358.00

52-week range (ZAR) 374.43 - 294.44

Market cap (ZAR)(m) 123,123.6

Shares outstanding (m) 333

FTSE/JSE ALL SHARE 53,789.8

FYE 6/30 2015A 2016E 2017E

Revenue (ZARm)

204,916 229,990 243,876

DB PBT (ZARm) 8,513 9,805 10,839

Stated PBT (ZARm)

8,435 9,805 10,839

DB EPS (ZAR) 18.72 20.74 22.89

DPS (ZAR) 9.09 10.03 11.06

P/E (DB EPS)(x) 16.2 17.9 16.3

Spin-off of Foodservice the key question going forward

Bidvest operates a diversified business model: while five of its 12 divisions account

for c.70% of group profit, we highlight the diverse nature of these five major

divisions. Collectively, Bidvest operates a mix of defensive business models that

function in lower-growth economic conditions. We estimate that c.40% of group

earnings come from non-rand currencies, providing a rand hedge. The challenge

will be how the enterprise value evolves in the face of a separate Foodservice

listing, raising the question of how the combination of other businesses could trade

on a stand-alone basis; we move from Buy to

Hold based on current share price levels.

We adjust our numbers for proforma financials – new BVT target price of R358 We

review the historic proforma financials for Foodservice in light of this new

information vs. our estimates published earlier in February 2016. We adjust our

numbers for lower revenue figures, higher interest charges and a lower effective tax

rate. Bidvest share count is to increase proforma for the transaction, making the

diluted weighted share count 331.3m (2.3% dilution from H1FY16). We currently

value Foodservice at R203 per share (down from

R213) on a base case.

We value Bidvest at R358 per share with no change to methodology We value

Bidvest using a weighted methodology including trading multiples of comparable

companies and SOTP on a 20% and 80% weighting, respectively. Our sum-of-the-

parts uses rolling EBIT multiples for the various divisions, excluding: 1) property, for

which we apply an 8.5% cap rate to the portfolio; 2) Bidvest Bank, which we value

on a price/book value of 2.0x; and 3) Bidvest Namibia, Adcock Ingram, and Comair,

for which we use current market values. Downside risks include: 1) inability to grow

earnings and 2) weakness in larger divisions. Upside risks include 1) re-rating of

Foodservice and 2) earnings surprise.

John Kim-Sa (+27) 11 775-7013

[email protected]

21 April 2016



Integrated Oils and Refiners 1Q Preview: The Shift from Survival to Recovery

1Q16 Preview - Setting the stage for the recovery With crude oil balances likely to tighten through 2H16, and sentiment largely shifting constructive on both crude and the equities, we expect the market to look through what is likely to be a trough in qtrly results (high capex, low commodity), instead focusing on relative positioning into 2017 and the pace/magnitude of potentially increasing activity. Although we anticipate an emphasis on continued fiscal discipline, we expect signs of first-mover efforts by top-tier balance sheet/resource quality names (PXD) and an early road map into recovery for others. We favor quality multi-year outperformers (PXD, OXY), higher oil leverage plays (DVN, MRO, COP), and downgrade EOG to Hold.

Closing funding gaps, the organic (and inorganic) way Since a 4Q15 results season that was largely focused on 2016 budgets and survival, the outlook for funding has significantly improved, with a projected $25 Bn funding gap reduced to $9 Bn through a combination of asset sales ($5 Bn), equity issuance ($6 Bn) and an $5/bbl increase in the 2016 forward curve ($5 Bn). While recent asset sales have shown some signs of encouragement, we expect the market to remain challenging, and look for updates on outstanding asset sale programs (DVN, APC, COP), as well as potential for increasing capital flexibility post successful divestitures and/or equity issuance (MRO, DVN, HES).

From Flight to Fight: Framing the potential for the return of capital We expect conference calls to focus primarily on flexibility within current capital budgets, and the pace, magnitude and relative priority of a return to increased activity. Although we expect 2016 budgets to remain largely unchanged as yet, as companies emphasize capital discipline and balance sheet preservation, we expect increased discussion on hedging as a pre-cursor to a return of rigs (PXD now 45% oil hedged through much of 2017), DUC drawdown as a first step forward (EOG, APC), and the potential for the first rig/completion additions at $45/bbl crude from top-tier balance sheet/asset quality names (ie. PXD and other core Permian producers). While resource updates have garnered limited interest over the past 18 months, we expect potentially positive drilling/de-risking results from DVN, NBL, MRO. Within, see company by company details.

Continued shift towards higher beta/crude leverage: Downgrade EOG to Hold Although we still see advantaged balance sheet/resource quality names as multi-year outperformers (PXD, OXY) in what is likely to be a choppy, volatile and relatively moderate pace of recovery, we continue to highlight the need for increasing exposure to higher beta names, DVN, MRO and COP, which in a move from $40/bbl to $55-$60/bbl offer increased exposure to a recovery via potential asset sale/balance sheet catalysts, leading crude leverage and underappreciated improvements to cost structure. As such, we downgrade EOG from BUY to HOLD on relative valuation. The company remains a best-in-class operator with leading asset quality, but given significant outperformance, aggressive multiple expansion (6.2x premium on 2016 EV/DACF vs. historical peer average multiple) and limited NAV upside in a move to $65/bbl crude, we see greater potential upside elsewhere in the sector (see page 8).

Valuation and Risk Companies in our integrated/large-cap space are valued on either on a EV/DACF multiple (CVX, XOM, COP, and OXY) or on a blended NAV, EV/DACF multiple methodology. NAVs assume $70/bbl, $65/bbl, and $3.75/mcf for Brent, WTI and Henry Hub pricing respectively. Primary downside risks include a decline in global oil demand and a decrease in the underlying commodity. Upside risks include increased demand and increased operator efficiency. Major upside/downside risks to the refiners include an increase/ decrease in global product demand and a decrease/increase in feedstock costs.

(Originally published on 20 April 2016)

Ryan Todd (+1) 212 250-8342

[email protected]

21 April 2016



Appendix 1

Important Disclosures

Additional information available upon request

*Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced from local exchanges via Reuters, Bloomberg and other vendors . Other information is sourced from Deutsche Bank, subject companies, and other sources. For disclosures pertaining to recommendations or estimates made on securities other than the primary subject of this research, please see the most recently published company report or visit our global disclosure look-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr

Analyst Certification

This report covers more than one security and was contributed to by more than one analyst. The views expressed in this report accurately reflect the views of each contributor to this compendium report. In addition, each contributor has not and will not receive any compensation for providing a specific recommendation or view in this compendium report.

Equity rating key Equity rating dispersion and banking relationships

Buy: Based on a current 12- month view of total share-holder return (TSR = percentage change in share price from current price to projected target price plus pro-jected dividend yield ) , we recommend that investors buy the stock.

Sell: Based on a current 12-month view of total share-holder return, we recommend that investors sell the stock

Hold: We take a neutral view on the stock 12-months out and, based on this time horizon, do not recommend either a Buy or Sell.

Newly issued research recommendations and target prices supersede previously published research.

45 % 48 %

7 %35 % 30 %

18 %0

200

400

600

800

1000

1200

1400

1600

Buy Hold Sell

Global Universe

Companies Covered Cos. w/ Banking Relationship

Regulatory Disclosures

1.Important Additional Conflict Disclosures

Aside from within this report, important conflict disclosures can also be found at https://gm.db.com/equities under the

"Disclosures Lookup" and "Legal" tabs. Investors are strongly encouraged to review this information before investing.

2.Short-Term Trade Ideas

Deutsche Bank equity research analysts sometimes have shorter-term trade ideas (known as SOLAR ideas) that are

consistent or inconsistent with Deutsche Bank's existing longer term ratings. These trade ideas can be found at the

SOLAR link at http://gm.db.com.

21 April 2016



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21 April 2016



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Copyright © 2016 Deutsche Bank AG

David Folkerts-Landau Chief Economist and Global Head of Research

Raj Hindocha Global Chief Operating Officer

Research

Marcel Cassard Global Head

FICC Research & Global Macro Economics

Steve Pollard Global Head

Equity Research

Michael Spencer Regional Head

Asia Pacific Research

Ralf Hoffmann Regional Head

Deutsche Bank Research, Germany

Andreas Neubauer Regional Head

Equity Research, Germany

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