6 December 2024
Weekly Market View
Another year of US exceptionalism?
US exceptionalism has scaled new heights this year. US equities have gained 29% year to date, following 26% returns in 2023, widening the performance gap with other markets.
President-elect Trump’s policies are likely to lead to another year of US equity outperformance in 2025. However, prudence dictates investors stay diversified and nimble to hedge against risks.
Our strategies, which hold a slight preference for US assets, offer investors ways to capture opportunities while avoiding taking undue risks.
We remain overweight gold to hedge against rising geopolitical uncertainty (as seen in France and South Korea this week) and any revival in inflation.
Europe’s escalating political uncertainty raises the risk of sustained ECB policy easing after a likely 25bps rate cut next week, lifting European government bonds.
Meanwhile, the unexpected political turmoil in Korea should boost Korean USD bonds, especially in the financial sector.
Where are the opportunities in US equities ahead of the holiday season?
What is the outlook for Korean equities, given recent political uncertainty?
What are the implications of France’s political uncertainty on markets?
Charts of the week: Standout economy
We see continued US outperformance amid robust earnings outlook and Trump’s policies; revival of inflation is a key risk
Consensus earnings estimates for major markets
US headline and core inflation, long-term inflation expectation
Source: Bloomberg, Standard Chartered
Editorial
Another year of US exceptionalism?
US exceptionalism has scaled new heights this year. US equities have gained 29% year to date, following 26% returns in 2023, widening the performance gap with other markets. President-elect Trump’s policies are likely to lead to another year of US equity outperformance in 2025. However, prudence dictates investors stay diversified and nimble to hedge against risks. Our strategies, which hold a slight preference for US assets, offer investors ways to capture opportunities while avoiding taking undue risks. We remain overweight gold to hedge against rising geopolitical uncertainty (as seen in France and South Korea this week) and any revival in inflation.
US exceptionalism: This year’s gains have been led by our three preferred sectors: technology (up 39% so far this year), communication services (37%) and financials (35%). President-elect Trump’s policies, focussed on tax cuts and deregulation, are likely to benefit US corporate earnings, while tariffs raise uncertainty for non-US markets (see chart). The technology and communication services sectors are likely to drive earnings growth, thanks to the ongoing structural rise in demand for generative Artificial Intelligence-related tools and systems. The financial sector, especially the regional and community banks, is likely to be a major beneficiary of deregulation policies.
Uncharted geopolitical landscape: Trump has already notified key trade partners such as China, Canada and Mexico of his plans to impose stiff import tariffs. It remains to be seen whether the threat of tariffs is a negotiating tool to achieve his objective of attracting manufacturing investment into the US or is an advance notice of building walls, at least temporarily, to protect domestic industry against imports and reduce the trade deficit. While the nomination of Wall Street veteran Scott Bessent suggests Trump wants to use tariffs as “a means to an end”, Trump’s cabinet consists of trade ‘hawks’ who see tariffs as “an end in itself” to rebalance US economic drivers and the pattern of global trade. How key trade partners such as China and Europe react, given their own internal economic and political challenges, is another key question.
Sequencing and substance of tax cuts: How Trump goes about balancing the seemingly divergent economic objectives will be key for markets in the coming months. For instance, revenue from the proposed tariffs is expected to partly pay for Trump’s other signature policy of extending the individual tax cuts which expire next year. Will Trump issue executive orders to impose stiff tariffs on major trade partners as soon he takes charge on 20 January to enable the tax cuts later in the year?
The Republican party’s thin majority in the House of Representatives would make it challenging to pass any ambitious tax cuts through a special “reconciliation” bill in the Congress. Our base case is that the administration will extend the prior tax cuts, perhaps with a few other election promises, such as ending taxes on tips and gratuities. Enacting more ambitious measures such as exempting social security from taxes or significantly cutting corporate taxes further would raise concerns about the budget deficit and lead to a surge in bond yields, something that the administration would try to avoid.
Inflation expectations and the Fed. So far inflation expectations have been well behaved, calming bond yields after a brief spike following Trump’s election. We expect the Fed to look through any initial rise in inflation due to tariffs and continue cutting rates by 75bps next year, after an expected 25bps cut this month, but any rise in inflation expectations could lead the Fed to hold rates, upending bond markets.
Strategies for all seasons: Against the uncertain backdrop, investors can position through diversified strategies, based on their individual risk tolerance, to capture the opportunities and still hedge against the risks. Our diversified growth, balanced, conservative and income-focussed strategies, catering to diverse risk profiles, have delivered almost 16%, 13%, 4% and 8% total returns year to date. We are positioned for another year of US exceptionalism, but remain nimble to changing dynamics, especially if Trump’s policies lead to significant fiscal policy easing in China and Europe over the coming months. (Look out for our Annual Outlook due to be published on 13 December for more details on strategies to navigate 2025.)
The weekly macro balance sheet
Our weekly net assessment: On balance, we see the past week’s data and policy as Neutral for risk assets in the near-term
(+) factors: Robust manufacturing data; Recovery in US factory data
(-) factors: Weak US and China Services PMI; Rising political risks
US services sector business confidence fell, while manufacturing sector confidence rose in November
US ISM PMIs for manufacturing, manufacturing new orders and services sectors
Euro area consumer inflation has stabilised just above the ECB’s 2% target, while deflation in producer prices continues
Euro area consumer and producer price inflation
China’s manufacturing sector business confidence picked up in November, while services sector remains lacklustre
China Caixin manufacturing and services PMIs
Top client questions
Where are the opportunities ahead of the holiday season?
Preliminary US holiday season sales data point to upbeat momentum. According to Adobe, consumer spending rose 7.3% y/y on Cyber Monday, with 57% of the day’s online sales being transacted on a mobile device. In particular, generative AI-powered chat bots contributed significantly to consumers’ shopping behaviours, with traffic to retail sites from chat bots surging 1,950% y/y. The company projects sales of the full holiday season (1 Nov – 31 Dec 2024) to rise by 8.4% y/y.
We expect consumption resiliency amid a favourable economic backdrop to support continued sales growth through the holiday season this year. We continue to favour the technology and communication services sectors in the US, in particular digital advertising and e-commerce sub-sectors. Revamped interfaces across major e-commerce platforms under the adoption of Artificial Intelligence (AI) systems, as well as the rising penetration of big data technology on online marketing sales platforms, are expected to optimize customer demand and bolster cross-selling opportunities. Earnings expectations of both sectors in 2024 have also been revised higher since the start of H2 and are now at 20.1% (technology) and 23.8% (communication services) respectively.
— Michelle Kam, Investment Strategist
2024 earnings projections for US technology and communication services sectors have been revised higher
Estimated earnings growth across sectors within the S&P 500 index in 2024 (data as of 29-Nov-24)
What is the outlook for Korean equities, given recent political uncertainty?
We have been Underweight Korean equities within the Asia ex-Japan region. The recent, and brief, declaration of martial law adds to the list of headwinds against Korean equities. President Yoon’s move triggered a public outcry, with trade unions vowing to strike until he resigns. Yoon’s impeachment or resignation would impact fiscal spending and weigh on the economic outlook.
The global economic outlook is also acting as a headwind. Korean equities, which are highly leveraged to the semiconductor sector, are sensitive to incoming US President Trump’s hawkish trade policies. It is possible Trump “suggests” his allies restrict chip sales to China, before he sends a similar message to US semiconductor companies. MSCI Korea trades at 8x forward P/E, a discount to the long-term historical average at 10.5x – though we believe this discount is likely to persist, if not widen.
Within Asia ex-Japan, we are Overweight Indian equities as we believe they are more insulated from Trump’s rhetoric. The recent pullback in Indian equities have helped valuations pull back to their 12-month average while return-on-equity is still strong at 16%.
— Daniel Lam, CFA, Head, Equity Strategy
Korea equity valuation discount is likely to continue, or even widen, given domestic political uncertainties and Trump’s proposed trade policies
MSCI Korea 12-month forward PE
Top client questions (cont’d)
What implications will the political uncertainty in France have for the upcoming ECB decision and the outlook for the Euro and European government bonds?
France has made headlines as a political stalemate deepens. In a bold move, Prime Minister Michel Barnier attempted to push through a “special law” under Article 45 of the Organic Law of Budget Bills to extend the 2024 budget into 2025. This manoeuvre backfired, resulting in a motion of no confidence that successfully removed him from office, although he is likely to serve as a caretaker until a new candidate is appointed. Political instability is expected to persist as the government faces a potential shutdown in January.
Similar to the situation in late June when President Macron called for a snap election to extend his power, there is some risk aversion in markets. However, negative sentiment in markets remains relatively subdued: 1) the 5-year French CDS (a measure of sovereign default concerns) rose from 31bp to 40bp in less than two weeks, but this increase is modest compared to the 16bp jump in June; 2) the French 10-year bond yield has continued to trend lower alongside expected ECB cuts; 3) the spread between 10-year German and French government bonds rose only 10bp, just 6bp more than during the Macron episode in June. Given this context, we reiterate our view that European government bonds (FX-hedged) remain an attractive opportunistic idea. We see current volatility as an opportunity to add against the backdrop of still-soft European data and a high likelihood of continued ECB rate cuts.
Interestingly, EUR/USD held at 1.05 despite the political risk. We expect the currency market focus to remain on fundamentals. The Euro area services PMI was revised upwards to 49.5, from 49.2 in the preliminary estimate, but it was still lower than the October reading of 51.6. This marked the first contraction in services since January. Additionally, manufacturing PMIs also point to contraction. It is not surprising, therefore, that we expect the ECB to continue cutting rates including at the next meeting. Meanwhile, US Fed Chair Powell noted robust economic strength since the central bank started cutting interest rates in September meant policymakers can be little more “cautious” in cutting rates further. The Fed’s Beige Book survey also showed US businesses were optimistic about improving demand in the coming months and held some concerns about the potentially inflationary impact of President-elect Trump’s policies. Overall, we believe this, together with weak technical, suggest EUR/USD is likely to test its support at 1.0330 over the next 2-4 weeks.
— Ray Heung, Senior Investment Strategist
— Iris Yuen, Investment Strategist
France’s credit risk measures haven’t risen significantly above early 2024 highs
France’s 5-year credit default swap spread and 10-year government bond yield
EUR/USD bearish momentum is likely to continue in the near-term
EUR/USD and technical levels
Market performance summary*
*Performance in USD terms unless otherwise stated, 2024 YTD performance from 31 December 2023 to 5 December 2024; 1-week period: 28 November 2024 to 5 December 2024
Our 12-month asset class views at a glance
Economic and market calendar
The S&P500 has next interim resistance at 6,206
Technical indicators for key markets as of 5 December close
Investor diversity has normalised across asset classes
Our proprietary market diversity indicators as of 5 Dec close
Disclosure
This document is confidential and may also be privileged. If you are not the intended recipient, please destroy all copies and notify the sender immediately. This document is being distributed for general information only and is subject to the relevant disclaimers available at our Standard Chartered website under Regulatory disclosures. It is not and does not constitute research material, independent research, an offer, recommendation or solicitation to enter into any transaction or adopt any hedging, trading or investment strategy, in relation to any securities or other financial instruments. This document is for general evaluation only. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person or class of persons and it has not been prepared for any particular person or class of persons. You should not rely on any contents of this document in making any investment decisions. Before making any investment, you should carefully read the relevant offering documents and seek independent legal, tax and regulatory advice. In particular, we recommend you to seek advice regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs, before you make a commitment to purchase the investment product. Opinions, projections and estimates are solely those of SC at the date of this document and subject to change without notice. Past performance is not indicative of future results and no representation or warranty is made regarding future performance. The value of investments, and the income from them, can go down as well as up, and you may not recover the amount of your original investment. You are not certain to make a profit and may lose money. Any forecast contained herein as to likely future movements in rates or prices or likely future events or occurrences constitutes an opinion only and is not indicative of actual future movements in rates or prices or actual future events or occurrences (as the case may be). This document must not be forwarded or otherwise made available to any other person without the express written consent of the Standard Chartered Group (as defined below). Standard Chartered Bank is incorporated in England with limited liability by Royal Charter 1853 Reference Number ZC18. The Principal Office of the Company is situated in England at 1 Basinghall Avenue, London, EC2V 5DD. Standard Chartered Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. Standard Chartered PLC, the ultimate parent company of Standard Chartered Bank, together with its subsidiaries and affiliates (including each branch or representative office), form the Standard Chartered Group. Standard Chartered Private Bank is the private banking division of Standard Chartered. Private banking activities may be carried out internationally by different legal entities and affiliates within the Standard Chartered Group (each an “SC Group Entity”) according to local regulatory requirements. Not all products and services are provided by all branches, subsidiaries and affiliates within the Standard Chartered Group. Some of the SC Group Entities only act as representatives of Standard Chartered Private Bank and may not be able to offer products and services or offer advice to clients.
Copyright © 2024, Accounting Research & Analytics, LLC d/b/a CFRA (and its affiliates, as applicable). Reproduction of content provided by CFRA in any form is prohibited except with the prior written permission of CFRA. CFRA content is not investment advice and a reference to or observation concerning a security or investment provided in the CFRA SERVICES is not a recommendation to buy, sell or hold such investment or security or make any other investment decisions. The CFRA content contains opinions of CFRA based upon publicly-available information that CFRA believes to be reliable and the opinions are subject to change without notice. This analysis has not been submitted to, nor received approval from, the United States Securities and Exchange Commission or any other regulatory body. While CFRA exercised due care in compiling this analysis, CFRA, ITS THIRD-PARTY SUPPLIERS, AND ALL RELATED ENTITIES SPECIFICALLY DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, to the full extent permitted by law, regarding the accuracy, completeness, or usefulness of this information and assumes no liability with respect to the consequences of relying on this information for investment or other purposes. No content provided by CFRA (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of CFRA, and such content shall not be used for any unlawful or unauthorized purposes. CFRA and any third-party providers, as well as their directors, officers, shareholders, employees or agents do not guarantee the accuracy, completeness, timeliness or availability of such content. In no event shall CFRA, its affiliates, or their third-party suppliers be liable for any direct, indirect, special, or consequential damages, costs, expenses, legal fees, or losses (including lost income or lost profit and opportunity costs) in connection with a subscriber’s, subscriber’s customer’s, or other’s use of CFRA’s content.
Market Abuse Regulation (MAR) Disclaimer
Banking activities may be carried out internationally by different branches, subsidiaries and affiliates within the Standard Chartered Group according to local regulatory requirements. Opinions may contain outright “buy”, “sell”, “hold” or other opinions. The time horizon of this opinion is dependent on prevailing market conditions and there is no planned frequency for updates to the opinion. This opinion is not independent of Standard Chartered Group’s trading strategies or positions. Standard Chartered Group and/or its affiliates or its respective officers, directors, employee benefit programmes or employees, including persons involved in the preparation or issuance of this document may at any time, to the extent permitted by applicable law and/or regulation, be long or short any securities or financial instruments referred to in this document or have material interest in any such securities or related investments. Therefore, it is possible, and you should assume, that Standard Chartered Group has a material interest in one or more of the financial instruments mentioned herein. Please refer to our Standard Chartered website under Regulatory disclosures for more detailed disclosures, including past opinions/ recommendations in the last 12 months and conflict of interests, as well as disclaimers. A covering strategist may have a financial interest in the debt or equity securities of this company/issuer. This document must not be forwarded or otherwise made available to any other person without the express written consent of Standard Chartered Group.
Sustainable Investments
Any ESG data used or referred to has been provided by Morningstar, Sustainalytics, MSCI or Bloomberg. Refer to 1) Morningstar website under Sustainable Investing, 2) Sustainalytics website under ESG Risk Ratings, 3) MCSI website under ESG Business Involvement Screening Research and 4) Bloomberg green, social & sustainability bonds guide for more information. The ESG data is as at the date of publication based on data provided, is for informational purpose only and is not warranted to be complete, timely, accurate or suitable for a particular purpose, and it may be subject to change. Sustainable Investments (SI): This refers to funds that have been classified as ‘Sustainable Investments’ by Morningstar. SI funds have explicitly stated in their prospectus and regulatory filings that they either incorporate ESG factors into the investment process or have a thematic focus on the environment, gender diversity, low carbon, renewable energy, water or community development. For equity, it refers to shares/stocks issued by companies with Sustainalytics ESG Risk Rating of Low/Negligible. For bonds, it refers to debt instruments issued by issuers with Sustainalytics ESG Risk Rating of Low/Negligible, and/or those being certified green, social, sustainable bonds by Bloomberg. For structured products, it refers to products that are issued by any issuer who has a Sustainable Finance framework that aligns with Standard Chartered’s Green and Sustainable Product Framework, with underlying assets that are part of the Sustainable Investment universe or separately approved by Standard Chartered’s Sustainable Finance Governance Committee. Sustainalytics ESG risk ratings shown are factual and are not an indicator that the product is classified or marketed as “green”, “sustainable” or similar under any particular classification system or framework.
Country/Market Specific Disclosures
Botswana: This document is being distributed in Botswana by, and is attributable to, Standard Chartered Bank Botswana Limited which is a financial institution licensed under the Section 6 of the Banking Act CAP 46.04 and is listed in the Botswana Stock Exchange. Brunei Darussalam: This document is being distributed in Brunei Darussalam by, and is attributable to, Standard Chartered Bank (Brunei Branch) | Registration Number RFC/61 and Standard Chartered Securities (B) Sdn Bhd | Registration Number RC20001003. Standard Chartered Bank is incorporated in England with limited liability by Royal Charter 1853 Reference Number ZC18. Standard Chartered Securities (B) Sdn Bhd is a limited liability company registered with the Registry of Companies with Registration Number RC20001003 and licensed by Brunei Darussalam Central Bank as a Capital Markets Service License Holder with License Number BDCB/R/CMU/S3-CL and it is authorised to conduct Islamic investment business through an Islamic window. China Mainland: This document is being distributed in China by, and is attributable to, Standard Chartered Bank (China) Limited which is mainly regulated by National Financial Regulatory Administration (NFRA), State Administration of Foreign Exchange (SAFE), and People’s Bank of China (PBOC). Hong Kong: In Hong Kong, this document, except for any portion advising on or facilitating any decision on futures contracts trading, is distributed by Standard Chartered Bank (Hong Kong) Limited (“SCBHK”), a subsidiary of Standard Chartered PLC. SCBHK has its registered address at 32/F, Standard Chartered Bank Building, 4-4A Des Voeux Road Central, Hong Kong and is regulated by the Hong Kong Monetary Authority and registered with the Securities and Futures Commission (“SFC”) to carry on Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activity under the Securities and Futures Ordinance (Cap. 571) (“SFO”) (CE No. AJI614). The contents of this document have not been reviewed by any regulatory authority in Hong Kong and you are advised to exercise caution in relation to any offer set out herein. If you are in doubt about any of the contents of this document, you should obtain independent professional advice. Any product named herein may not be offered or sold in Hong Kong by means of any document at any time other than to “professional investors” as defined in the SFO and any rules made under that ordinance. In addition, this document may not be issued or possessed for the purposes of issue, whether in Hong Kong or elsewhere, and any interests may not be disposed of, to any person unless such person is outside Hong Kong or is a “professional investor” as defined in the SFO and any rules made under that ordinance, or as otherwise may be permitted by that ordinance. In Hong Kong, Standard Chartered Private Bank is the private banking division of SCBHK, a subsidiary of Standard Chartered PLC. Ghana: Standard Chartered Bank Ghana Limited accepts no liability and will not be liable for any loss or damage arising directly or indirectly (including special, incidental or consequential loss or damage) from your use of these documents. Past performance is not indicative of future results and no representation or warranty is made regarding future performance. You should seek advice from a financial adviser on the suitability of an investment for you, taking into account these factors before making a commitment to invest in an investment. To unsubscribe from receiving further updates, please send an email to feedback.ghana@sc.com. Please do not reply to this email. Call our Priority Banking on 0302610750 for any questions or service queries. You are advised not to send any confidential and/or important information to Standard Chartered via e-mail, as Standard Chartered makes no representations or warranties as to the security or accuracy of any information transmitted via e-mail. Standard Chartered shall not be responsible for any loss or damage suffered by you arising from your decision to use e-mail to communicate with the Bank. India: This document is being distributed in India by Standard Chartered in its capacity as a distributor of mutual funds and referrer of any other third party financial products. Standard Chartered does not offer any ‘Investment Advice’ as defined in the Securities and Exchange Board of India (Investment Advisers) Regulations, 2013 or otherwise. Services/products related securities business offered by Standard Charted are not intended for any person, who is a resident of any jurisdiction, the laws of which imposes prohibition on soliciting the securities business in that jurisdiction without going through the registration requirements and/or prohibit the use of any information contained in this document. Indonesia: This document is being distributed in Indonesia by Standard Chartered Bank, Indonesia branch, which is a financial institution licensed, registered and supervised by Otoritas Jasa Keuangan (Financial Service Authority). Jersey: In Jersey, Standard Chartered Private Bank is the Registered Business Name of the Jersey Branch of Standard Chartered Bank. The Jersey Branch of Standard Chartered Bank is regulated by the Jersey Financial Services Commission. Copies of the latest audited accounts of Standard Chartered Bank are available from its principal place of business in Jersey: PO Box 80, 15 Castle Street, St Helier, Jersey JE4 8PT. Standard Chartered Bank is incorporated in England with limited liability by Royal Charter in 1853 Reference Number ZC 18. The Principal Office of the Company is situated in England at 1 Basinghall Avenue, London, EC2V 5DD. Standard Chartered Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. The Jersey Branch of Standard Chartered Bank is also an authorised financial services provider under license number 44946 issued by the Financial Sector Conduct Authority of the Republic of South Africa. Jersey is not part of the United Kingdom and all business transacted with Standard Chartered Bank, Jersey Branch and other SC Group Entity outside of the United Kingdom, are not subject to some or any of the investor protection and compensation schemes available under United Kingdom law. Kenya: This document is being distributed in Kenya by and is attributable to Standard Chartered Bank Kenya Limited. Investment Products and Services are distributed by Standard Chartered Investment Services Limited, a wholly owned subsidiary of Standard Chartered Bank Kenya Limited that is licensed by the Capital Markets Authority in Kenya, as a Fund Manager. Standard Chartered Bank Kenya Limited is regulated by the Central Bank of Kenya. Malaysia: This document is being distributed in Malaysia by Standard Chartered Bank Malaysia Berhad (“SCBMB”). Recipients in Malaysia should contact SCBMB in relation to any matters arising from, or in connection with, this document. This document has not been reviewed by the Securities Commission Malaysia. The product lodgement, registration, submission or approval by the Securities Commission of Malaysia does not amount to nor indicate recommendation or endorsement of the product, service or promotional activity. Investment products are not deposits and are not obligations of, not guaranteed by, and not protected by SCBMB or any of the affiliates or subsidiaries, or by Perbadanan Insurans Deposit Malaysia, any government or insurance agency. Investment products are subject to investment risks, including the possible loss of the principal amount invested. SCBMB expressly disclaim any liability and responsibility for any loss arising directly or indirectly (including special, incidental or consequential loss or damage) arising from the financial losses of the Investment Products due to market condition. Nigeria: This document is being distributed in Nigeria by Standard Chartered Bank Nigeria Limited (SCB Nigeria), a bank duly licensed and regulated by the Central Bank of Nigeria. SCB Nigeria accepts no liability for any loss or damage arising directly or indirectly (including special, incidental or consequential loss or damage) from your use of these documents. You should seek advice from a financial adviser on the suitability of an investment for you, taking into account these factors before making a commitment to invest in an investment. To unsubscribe from receiving further updates, please send an email to clientcare.ng@sc.com requesting to be removed from our mailing list. Please do not reply to this email. Call our Priority Banking on 02 012772514 for any questions or service queries. Standard Chartered shall not be responsible for any loss or damage arising from your decision to send confidential and/or important information to Standard Chartered via e-mail, as Standard Chartered makes no representations or warranties as to the security or accuracy of any information transmitted via e-mail. Pakistan: This document is being distributed in Pakistan by, and attributable to Standard Chartered Bank (Pakistan) Limited having its registered office at PO Box 5556, I.I Chundrigar Road Karachi, which is a banking company registered with State Bank of Pakistan under Banking Companies Ordinance 1962 and is also having licensed issued by Securities & Exchange Commission of Pakistan for Security Advisors. Standard Chartered Bank (Pakistan) Limited acts as a distributor of mutual funds and referrer of other third-party financial products. Singapore: This document is being distributed in Singapore by, and is attributable to, Standard Chartered Bank (Singapore) Limited (Registration No. 201224747C/ GST Group Registration No. MR-8500053-0, “SCBSL”). Recipients in Singapore should contact SCBSL in relation to any matters arising from, or in connection with, this document. SCBSL is an indirect wholly owned subsidiary of Standard Chartered Bank and is licensed to conduct banking business in Singapore under the Singapore Banking Act, 1970. Standard Chartered Private Bank is the private banking division of SCBSL. IN RELATION TO ANY SECURITY OR SECURITIES-BASED DERIVATIVES CONTRACT REFERRED TO IN THIS DOCUMENT, THIS DOCUMENT, TOGETHER WITH THE ISSUER DOCUMENTATION, SHALL BE DEEMED AN INFORMATION MEMORANDUM (AS DEFINED IN SECTION 275 OF THE SECURITIES AND FUTURES ACT, 2001 (“SFA”)). THIS DOCUMENT IS INTENDED FOR DISTRIBUTION TO ACCREDITED INVESTORS, AS DEFINED IN SECTION 4A(1)(a) OF THE SFA, OR ON THE BASIS THAT THE SECURITY OR SECURITIES-BASED DERIVATIVES CONTRACT MAY ONLY BE ACQUIRED AT A CONSIDERATION OF NOT LESS THAN S$200,000 (OR ITS EQUIVALENT IN A FOREIGN CURRENCY) FOR EACH TRANSACTION. Further, in relation to any security or securities-based derivatives contract, neither this document nor the Issuer Documentation has been registered as a prospectus with the Monetary Authority of Singapore under the SFA. Accordingly, this document and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the product may not be circulated or distributed, nor may the product be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons other than a relevant person pursuant to section 275(1) of the SFA, or any person pursuant to section 275(1A) of the SFA, and in accordance with the conditions specified in section 275 of the SFA, or pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA. In relation to any collective investment schemes referred to in this document, this document is for general information purposes only and is not an offering document or prospectus (as defined in the SFA). This document is not, nor is it intended to be (i) an offer or solicitation of an offer to buy or sell any capital markets product; or (ii) an advertisement of an offer or intended offer of any capital markets product. Deposit Insurance Scheme: Singapore dollar deposits of non-bank depositors are insured by the Singapore Deposit Insurance Corporation, for up to S$100,000 in aggregate per depositor per Scheme member by law. Foreign currency deposits, dual currency investments, structured deposits and other investment products are not insured. This advertisement has not been reviewed by the Monetary Authority of Singapore. Taiwan: SC Group Entity or Standard Chartered Bank (Taiwan) Limited (“SCB (Taiwan)”) may be involved in the financial instruments contained herein or other related financial instruments. The author of this document may have discussed the information contained herein with other employees or agents of SC or SCB (Taiwan). The author and the above-mentioned employees of SC or SCB (Taiwan) may have taken related actions in respect of the information involved (including communication with customers of SC or SCB (Taiwan) as to the information contained herein). The opinions contained in this document may change, or differ from the opinions of employees of SC or SCB (Taiwan). SC and SCB (Taiwan) will not provide any notice of any changes to or differences between the above-mentioned opinions. This document may cover companies with which SC or SCB (Taiwan) seeks to do business at times and issuers of financial instruments. Therefore, investors should understand that the information contained herein may serve as specific purposes as a result of conflict of interests of SC or SCB (Taiwan). SC, SCB (Taiwan), the employees (including those who have discussions with the author) or customers of SC or SCB (Taiwan) may have an interest in the products, related financial instruments or related derivative financial products contained herein; invest in those products at various prices and on different market conditions; have different or conflicting interests in those products. The potential impacts include market makers’ related activities, such as dealing, investment, acting as agents, or performing financial or consulting services in relation to any of the products referred to in this document. UAE: DIFC – Standard Chartered Bank is incorporated in England with limited liability by Royal Charter 1853 Reference Number ZC18.The Principal Office of the Company is situated in England at 1 Basinghall Avenue, London, EC2V 5DD. Standard Chartered Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. Standard Chartered Bank, Dubai International Financial Centre having its offices at Dubai International Financial Centre, Building 1, Gate Precinct, P.O. Box 999, Dubai, UAE is a branch of Standard Chartered Bank and is regulated by the Dubai Financial Services Authority (“DFSA”). This document is intended for use only by Professional Clients and is not directed at Retail Clients as defined by the DFSA Rulebook. In the DIFC we are authorised to provide financial services only to clients who qualify as Professional Clients and Market Counterparties and not to Retail Clients. As a Professional Client you will not be given the higher retail client protection and compensation rights and if you use your right to be classified as a Retail Client we will be unable to provide financial services and products to you as we do not hold the required license to undertake such activities. For Islamic transactions, we are acting under the supervision of our Shariah Supervisory Committee. Relevant information on our Shariah Supervisory Committee is currently available on the Standard Chartered Bank website in the Islamic banking section. For residents of the UAE – Standard Chartered Bank UAE does not provide financial analysis or consultation services in or into the UAE within the meaning of UAE Securities and Commodities Authority Decision No. 48/r of 2008 concerning financial consultation and financial analysis. Uganda: Our Investment products and services are distributed by Standard Chartered Bank Uganda Limited, which is licensed by the Capital Markets Authority as an investment adviser. United Kingdom: In the UK, Standard Chartered Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. This communication has been approved by Standard Chartered Bank for the purposes of Section 21 (2) (b) of the United Kingdom’s Financial Services and Markets Act 2000 (“FSMA”) as amended in 2010 and 2012 only. Standard Chartered Bank (trading as Standard Chartered Private Bank) is also an authorised financial services provider (license number 45747) in terms of the South African Financial Advisory and Intermediary Services Act, 2002. The Materials have not been prepared in accordance with UK legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research. Vietnam: This document is being distributed in Vietnam by, and is attributable to, Standard Chartered Bank (Vietnam) Limited which is mainly regulated by State Bank of Vietnam (SBV). Recipients in Vietnam should contact Standard Chartered Bank (Vietnam) Limited for any queries regarding any content of this document. Zambia: This document is distributed by Standard Chartered Bank Zambia Plc, a company incorporated in Zambia and registered as a commercial bank and licensed by the Bank of Zambia under the Banking and Financial Services Act Chapter 387 of the Laws of Zambia.