Key Data Releases and Events. Releases due today (28 September 2018)

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1 Investment Daily 28 September 2018 US stocks rose and bond yields were little changed European stocks gained whilst core bonds were flat; Italian assets sold off on budget concerns China s Shanghai Composite dropped despite announcement by FTSE to add Chinese onshore stocks to its indexes US stocks rose, led by gains in technology shares US equities finished higher on Thursday, as investors continued to digest the Fed s policy decision and looked ahead to the third-quarter earnings season next month. The S&P rose 0.3%, ending a four-day losing streak and was led by gains in technology stocks. US Treasuries modestly bear flattened, with front-end yields up slightly and longer maturities little changed, amid a large block flattener trade, soft 7-year debt auction and economic data showing a surprise widening in the trade deficit and drop in durable goods orders. 2-year and 5-year yields added 2bp each to 2.83% and 2.96% respectively, while 10-year yields ended flat at 3.05%. Most European stocks gained on Thursday with the Euro Stoxx 50 closing up 0.5% and the largest boost coming from health care and consumer discretionary stocks. At the country level, Germany s DAX rose 0.4%, supported by a weaker euro versus the US dollar. All other indices also closed up with the notable exception of Italy s FTSE MIB (-0.6%) with risk sentiment weighed by investor fears over the country s 2019 budget clashing with EU budget rules. Core Eurozone government bonds ended little changed yesterday, with German 10-year bund yields and French 10-year OAT yields closing flat at 0.53% and 0.84%, respectively. In the periphery, 10-year Spanish and Portuguese bonds edged up while Italian equivalents weakened (yields rose 3bp to 2.89%) following reports that discussions to agree budget targets might be delayed. Asian stock markets fell on Thursday, as investors digested the FOMC statement and press conference. Japan s Nikkei 225 closed 1.0% lower. China s Shanghai Composite retreated 0.5% despite the announcement by FTSE to add Chinese onshore stocks to its indexes from Industrial profit growth slowed in August. Hong Kong s Hang Seng closed down 0.4% as some banks raised their prime lending rate for the first time in 12 years post the Fed s 25bp rate hike. Elsewhere, Indian stocks erased earlier gains with the Sensex down 0.6% despite the central bank s decision to ease cash reserve rule to ease bank liquidity. Crude oil advanced on Thursday, amid concerns that US sanctions on Iran will tighten the demandsupply balance as the US Energy Secretary ruled out tapping the Strategic Petroleum Reserve. WTI crude for November delivery rose 0.8% to settle at USD72.1 a barrel. Key Data Releases and Events Yesterday US durable goods orders climbed 4.5% mom in August, higher than an expected 2.0% mom. As anticipated, headline results were helped by jet orders. Nonetheless, a proxy for business investment ex-aircraft non-defence capital goods orders edged 0.5% mom lower, after four months of solid advances. Overall, unfilled core durable orders continue to suggest near-term positive momentum in capital expenditure, supported by tax changes earlier this year. Pending home sales declined 1.8% mom in August, worse than an expected 0.5% mom dip. Housing sales have softened amid rising housing prices and mortgage costs, despite demand support from a healthy labour market and earlier personal tax cuts. All four regions decreased for the month. Releases due today (28 September 2018) Country Indicator Period Survey Prior Japan Jobless rate Aug 2.5% 2.5% Japan Industrial production (mom) Aug P 1.4% -0.1% UK GDP (qoq) Q2 F 0.4% 0.4% P Eurozone CPI estimate (yoy) Sep 2.1% 2.0% US PCE core (yoy) Aug 2.0% 2.0% US Uni. of Michigan consumer sentiment Sep F P A Actual Japan s jobless rate is expected to stabilise at 2.5% in August, as survey-based signals (the employment component of the Economy Watchers Survey and EPA consumer confidence survey, as well as the manufacturing PMI) during the month were little changed, although mostly edging down slightly. Japan industrial production for August is expected to rebound by 1.4% mom, after three straight months of losses, although concerns about US-China trade tensions will continue to weigh on exporters. The flash estimate for eurozone inflation in September is expected to edge up slightly from August s prints, with both headline and core inflation rising 0.1 percentage points to 2.1% and 1.1% yoy respectively. This would return the headline number to July s rate, which is the highest since December Core inflation pressures remain muted for the time being, however. This commentary provides a high level overview of the recent economic environment, and is for information purposes only. It is a marketing communication and does not constitute investment advice or a recommendation to any reader of this content to buy or sell investments nor should it be regarded as investment research. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of its dissemination. Past performance is not an indication of future returns

2 Meanwhile, in the US, following the underwhelming CPI print, PCE core for August is expected to edge lower to 2.2% yoy, from 2.3% previously. Past performance is not an indication of future returns 28/09/2018 Investment Daily 2

3 Market Snapshot 1-day 1-month 3-month 1-year YTD 52-week 52-week Fwd Close Change Change Change Change Change High Low P/E Equity Indices (% ) (% ) (% ) (% ) (% ) (X) World MSCI AC World Index (USD) North America US Dow Jones Industrial Average 26, ,769 22, US S&P 500 Index 2, ,941 2, US NASDAQ Composite Index 8, ,133 6, Canada S&P/TSX Composite Index 16, ,586 14, Europe MSCI AC Europe (USD) Euro Stoxx 50 Index 3, ,709 3, UK FTSE 100 Index 7, ,904 6, Germany DAX Index 12, ,597 11, France CAC-40 Index 5, ,657 5, Spain IBEX 35 Index 9, ,643 9, Italy FTSE MIB Index 21, ,544 20, Asia Pacific MSCI AC Asia Pacific ex Japan (USD) Japan Nikkei-225 Stock Average 23, ,129 20, Australian Stock Exchange 200 6, ,374 5, Hong Kong Hang Seng Index 27, ,484 26, Shanghai Composite Index 2, ,587 2, Hang Seng China Enterprises Index 10, ,963 10, Taiwan TAIEX Index 11, ,270 10, Korea KOSPI Index 2, ,607 2, India SENSEX 30 Index 36, ,990 31, Indonesia Jakarta Stock Price Index 5, ,693 5, Malaysia Kuala Lumpur Composite Index 1, ,896 1, Philippines Stock Exchange PSE Index 7, ,078 6, Singapore FTSE Straits Times Index 3, ,642 3, Thailand SET Index 1, ,853 1, Latam Argentina Merval Index 33, ,462 24, Brazil Bovespa Index* 80, ,318 69, Chile IPSA Index 5, ,895 4, Colombia COLCAP Index 1, ,598 1, Mexico S&P/BMV IPC Index 49, ,121 44, EEMEA Russia MOEX Index 2, ,475 2, South Africa JSE Index 56, ,777 53, Turkey ISE 100 Index* 99, ,532 84, *Indices expressed as total returns. All others are price returns. 3-month YTD 1-year 3-year 5-year Change Change Change Change Change Equity Indices - Total Return (% ) (% ) (% ) (% ) (% ) Global equities US equities Europe equities Asia Pacific ex Japan equities Japan equities Latam equities Emerging Markets equities All total return data quoted in USD terms and subject to a one-day lag. Data sourced from MSCI AC World Total Return Index, MSCI US Total Return Index, MSCI AC Europe Total Return Index, MSCI AC Asia Pacific ex Japan Total Return Index, MSCI Japan Total Return Index, MSCI Emerging Latin America Total Return Index, and MSCI Emerging Markets Total Return Index. Total return includes income from dividends and interest as well as appreciation or depreciation in the price of an asset over the given period. Past performance is not an indication of future returns 28/09/2018 Investment Daily 3

4 Market Snapshot 2 1-day 1-month 3-month 1-year YTD Close Change Change Change Change Change Bond indices - Total Return (Index Pts.) (% ) (% ) (% ) (% ) BarCap GlobalAgg (Hedged in USD) JPM EMBI Global BarCap US Corporate Index (USD) 2, BarCap Euro Corporate Index (Eur) BarCap Global High Yield (Hedged in USD) Markit iboxx Asia ex-japan Bond Index (USD) Markit iboxx Asia ex-japan High-Yield Bond Index (USD) Total return includes income from dividends and interest as well as appreciation or depreciation in the price of an asset over the given period. 1-day 1-month 3-months 1-year Year End Bonds Close Ago Ago Ago Ago 2017 US Treasury yields (%) 3-month Year Year Year Year Developed market 10-year bond yields (%) Japan UK Germany France Italy Spain day 1-month 3-months 1-year Year End 52-week 52-week Currencies (vs US dollar) Latest Ago Ago Ago Ago 2017 High Low Developed markets EUR/USD GBP/USD CHF/USD CAD JPY AUD NZD Asia HKD CNY INR MYR KRW 1,113 1,118 1,114 1,118 1,141 1,067 1,150 1,054 TWD Latam BRL COP 2,987 2,999 2,942 2,947 2,938 2,986 3,111 2,685 MXN EEMEA RUB ZAR TRY day 1-month 3-month 1-year YTD 52-week 52-week ago Change Change Change Change High Low Commodities Latest (% ) (% ) (% ) (% ) Gold 1,183 1, ,366 1,160 Brent Oil WTI Crude Oil R/J CRB Futures Index LME Copper 6,187 6, ,348 5,773 Past performance is not an indication of future returns 28/09/2018 Investment Daily 4

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