Index Return Monitor April 13, 2016 BRAD BROWN, CFA & ALLAN BISHOP INVESTMENT STRATEGY GROUP See Legal Disclaimer and Important Disclosure Footnotes at the end of this report for disclosures, including potential conflicts of interest. Catching Up After Stumbling Out Of The Gate After a rough start to the year, which saw the S&P/TSX Composite Index (TSX) fall 7.1% to a February 11 low, the equity markets managed to rally, in part due to a rebound in the crude oil price, and finished off the first quarter of the year in the green. The TSX gained 3.7% while the S&P 500 (S&P) rose 0.8%. Following January's initial steep decline, central banks made it clear they were ready to act; this helped the markets find some footing. The Bank of Canada maintained its record-low 0.50% interest rate while the European Central Bank hinted at increasing its bond-buying program. The Bank of Japan (BoJ) implemented a -0.1% deposit rate on excess reserves and the U.S. Federal Reserve (Fed) maintained its key rate in its first meeting following the December lift-off. One of the key causes of the turbulence throughout the quarter was the ongoing volatility in crude oil. High inventory levels, Iranian supply, slowing demand and Saudi Arabia s desire to recapture market share continued to pressure the commodity, pushing it to a new 12-year low of US$26.21/Bbl on February 11. The slide in oil and the overall pessimism regarding the global economy sent the TSX, S&P and global interest rates lower. Oil s slide sent the Government of Canada 10-year yield to a record low 1.0%, while interest rates in Europe and Japan fell into negative territory. The negative interest rates renewed interest in gold as it saw its largest inflow in the past several years. Mid-quarter weakness in oil subsided in February as Saudi Arabia and Russia discussed a possible production freeze and U.S. drilling rigs continued to shut down, signaling future supply reductions. Oil s subsequent recovery served as a bellwether for the global economy, encouraging investors to re-enter the equity markets. The rotation back into equities was funded by selling in Canadian and U.S. treasuries, pushing yields back higher. As the quarter neared its end, the mid-march Fed meeting provided one last catalyst for stocks. The central bank s policy makers reduced their projection of the number of interest rate hikes in 2016 to two from the prior expectation of four. This move pushed the U.S. dollar down and sent U.S. yields lower across the curve, with the U.S. 10-year note finishing off the quarter down 50 basis points. If the world s central banks continue to maintain an accommodative monetary policy stance and crude oil prices continue to firm up, the second quarter, while likely to remain volatile, could see a continuation of the recent risk-on trade. Bellwether Indices Price Price Performance (% Change) S&P/TSX COMPOSITE INDEX 13,494 4.9 3.7 1.4-9.4 3.7 S&P 500 INDEX 2,060 6.6 0.8 7.3-0.4 0.8 DOW JONES INDUS. AVG 17,685 7.1 1.5 8.6-0.5 1.5 NASDAQ COMPOSITE INDEX 4,870 6.8-2.7 5.4-0.6-2.7 The 1st Quarter Roller-Coaster Ride 4.0% 2.0% 0.0% -2.0% -4.0% -6.0% -8.0% -10.0% -12.0% 31-Dec 7-Jan 14-Jan TSX 21-Jan 28-Jan 4-Feb S&P 11-Feb 18-Feb 25-Feb 3-Mar 10-Mar 17-Mar 24-Mar 31-Mar www.cibcwoodgundy.com
Waiting on the Fed s Next Move Yields on both Canadian and U.S. treasuries settled into a trading range at the end of the quarter. Canadian 10-yr notes fell 16 basis points while the U.S. treasury 10-yr dropped 50 basis points for the quarter. Interest rates in Asia and Europe remained volatile with Japan pushing into further negative territory while German 10-yr bunds touched 0.08%. Canada & U.S. Yields Yield as of 31-Mar-16-1 mo -3 mo -6 mo -12 mo 3-month Canada T-Bills 0.45 0.46 0.51 0.43 0.55 Canada 5yr Notes 0.68 0.67 0.73 0.80 0.76 Canada 10yr Notes 1.23 1.19 1.39 1.43 1.36 Canada 30yr Bonds 2.01 1.98 2.15 2.20 1.98 US 3-month T-Bills 0.20 0.32 0.16-0.02 0.02 US 5yr Treasuries 1.20 1.21 1.76 1.36 1.37 US 10yr Treasuries 1.77 1.73 2.27 2.04 1.92 US 30yr Treasuries 2.61 2.62 3.02 2.85 2.54 Yen, Loonie Strengthen The Canadian dollar rallied versus the U.S. greenback, as it found strength in stabilizing crude oil prices. The Japanese Yen rose to a 17-month high versus the U.S. dollar. Currency Moves Level Change Canadian vs. U.S. Dollar 0.7690 4.1% 6.4% 2.4% -2.4% 6.4% Euro vs. Canadian Dollar 1.4799 0.5% -1.5% -0.5% 8.7% -1.5% Euro vs. U.S. Dollar 1.1380 4.7% 4.8% 1.8% 6.0% 4.8% U.S. Dollar vs. Japanese Yen 112.5700-0.1% -6.4% -6.1% -6.3% -6.4% Trade Weighted U.S. Dollar 94.5860-3.7% -4.1% -1.8% -3.8% -4.1% Lumber, Gold, Oil Rebound West Texas Intermediate crude oil fell to a 12-year low of US$26.21/Bbl in February before rallying to as high as US$42/Bbl in March. Investors focused on output negotiations amongst Iran, Russia and Saudi Arabia. The upcoming meeting of energy-producing nations in Doha will be closely watched. Lumber was the leader in the quarter helped by further gains in U.S. housing starts. Gold, silver and copper also performed well. Commodities Level Price as of 31-Mar-16-1 mo -3 mo -6 mo -12 mo YTD % RJ CRB Commodity Index 170.52 163.22 176.14 193.76 211.86-3.19 Gold Spot US$/oz 1232.71 1238.74 1061.42 1115.07 1183.68 16.14 Silver Spot US$/oz 15.44 14.90 13.86 14.52 16.66 11.40 Brent Crude Oil 39.60 35.97 37.28 48.37 55.11 6.22 West Texas Intermediate Oil 38.34 33.75 37.04 45.09 47.60 3.51 NYMEX Natural gas 1.96 1.71 2.34 2.52 2.64-16.17 Lumber 310.70 254.00 257.60 229.20 278.20 20.61 Copper 3-month 2.20 2.13 2.13 2.34 2.74 3.02 Nickel 3-month 3.85 3.86 4.00 4.72 5.62-3.74 Aluminum 3-month 0.69 0.71 0.68 0.72 0.81 0.86 Zinc 3-month 0.82 0.80 0.73 0.77 0.94 12.93 2 April 13, 2016
In Canadian-dollar terms, the TSX was the best performing major equity index in our coverage, thanks in part due to relative weakness in foreign currencies as the loonie strengthened. The gains on the TSX were helped by the recovery in oil and in the materials sector as metal & mining stocks received a lift from stronger precious and base metals prices. Emerging Markets Index was the second best performing Index but has had some currency headwinds to overcome. TSX Leads In Canadian Dollar Terms Index Returns In Canadian Dollars Price Performance % Change 1 mo 3 mo 6 mo 12 mo YTD S&P/TSX COMPOSITE INDEX 4.9 3.7 1.4-9.4 3.7 S&P 500 INDEX 2.4-5.3 4.8 2.1-5.3 DOW JONES INDUS. AVG. 2.8-4.6 6.1 2.0-4.6 NASDAQ COMPOSITE INDEX 2.6-8.6 3.0 1.9-8.6 BLOOMBERG EUROPEAN 500 1.9-9.2-3.5-8.2-9.2 MSCI EAFE 1.8-9.6-1.9-8.4-9.6 MSCI WORLD 2.3-6.9 1.8-3.0-6.9 MSCI EMERGING MARKETS 8.6-1.0 3.2-12.0-1.0, as of March 31, 2016 Bond-Heavy Mandates Outperform Mandates with a higher fixed income component continued to outperform for the quarter. Weak equity markets combined with a stronger loonie to put pressure on foreign investment returns. Long-Term Strategic Asset Allocation Investor Profiles (All In C$) Performance % Change (Global Equity/Cdn. Equity/Bonds/Cash) 1 mo 3 mo 6 mo 12 mo YTD CAPITAL PRESERVATION (5 / 15 / 65 / 20) 1.4 1.2 2.1-0.5 1.2 INCOME (12 / 18 / 60 / 10) 1.7 0.8 2.3-0.9 0.8 INCOME & GROWTH (25 / 20 / 50 / 5) 2.0-0.1 2.4-1.5-0.1 GROWTH (45 / 20 / 35 / 0) 2.4-1.7 2.4-2.2-1.7 AGGRESSIVE GROWTH (65 / 20 / 15 / 0) 2.7-3.4 2.2-2.9-3.4 and FTSE TMX Global Debt Capital Markets, as of March 31, 2016 TSX Outperforms; Long-Term Bonds Rise As Yields Drop Long-term Canadian bonds outpaced other maturities in the first quarter of 2016 as yields pushed lower. The TSX meanwhile saw a total return of 4.5% as oil and materials stocks bounced. This led to an outperformance of the TSX relative to its U.S. counterpart. Asset Class Returns Total Return % Change Index Yield % 1 mo 3 mo 6 mo 12 mo YTD 31-Mar-16 EQUITIES S&P/TSX Composite Total Return 5.3 4.5 3.1-6.6 4.5 3.2 S&P 500 Total Return 6.8 1.3 8.5 1.8 1.3 2.2 BONDS FTSE TMX Canada Bond Universe Index 0.8 1.4 2.4 0.8 1.4 FTSE TMX Canada Long Term Index 1.4 2.6 4.3-0.6 2.6 FTSE TMX Canada Mid Term Index 0.8 1.5 2.5 2.1 1.5 FTSE TMX Canada Short Term Index 0.3 0.4 0.9 1.1 0.4 and FTSE TMX Global Debt Capital Markets, as of March 31, 2016 3 April 13, 2016
Energy & Materials Sector Recover The energy & materials sectors outperformed as commodity prices bounced significantly in Q1. The oil price rally re-ignited investor interest in the Canadian oil & gas producers which led to a bounce in share prices. The health care sector was a drag on the TSX due to its biggest constituent: Valeant Pharmaceuticals. Valeant saw its share price lose more than 70% of its value in the quarter as it slashed its quarterly guidance and continued to be plagued by ongoing accounting issues. S&P/TSX Sector Returns Index Price Index Price Performance % Change Weight GICS Sectors Consumer Discretionary 6.8 1859.3 6.1 2.4-3.5-6.4 2.4 Consumer Staples 4.7 4463.4 1.0 6.7 7.3 15.0 6.7 Energy 18.9 2155.1 9.0 7.9 5.1-18.3 7.9 - Integrated O&G 5.1 2891.3 8.1 0.3-3.7-10.5 0.3 - O&G Expl. & Prod. 5.6 1452.8 16.5 13.9 13.0-25.4 13.9 - Pipeline 6.8 2221.4 4.6 12.1 8.2-15.2 12.1 Financials 38.0 2228.0 7.3 2.8 3.4-1.8 2.8 - Banks 23.7 2633.5 9.2 4.6 4.7 0.8 4.6 - Insurance 5.6 1071.6 2.6-5.0-2.9-7.3-5.0 - REITs 2.6 1280.6 5.9 9.0 3.3-8.2 9.0 Health Care 1.0 557.0-53.1-67.4-79.4-81.0-67.4 Industrials 8.3 2185.1 5.4 3.5 1.8-10.5 3.5 Info Technology 3.1 221.7 2.9 0.1 10.3 5.8 0.1 Materials 11.0 1822.0 3.3 19.3 23.0-10.5 19.3 - Gold 5.7 1450.0 0.7 38.3 45.3 14.6 38.3 - Base Metals 1.0 2908.0 20.7 23.0 22.1-41.5 23.0 - Fertilizer 2.0 4268.4-2.7-7.0-12.9-34.2-7.0 Telecom Services 5.8 1392.3 3.1 10.3 7.2 10.2 10.3 Utilities 2.5 1960.9 8.0 8.3 5.5-2.5 8.3 REIT Returns REIT Index 154.9 5.9 9.0 3.3-8.1 9.0 REIT Total Return Index 381.2 6.5 10.7 6.7-2.2 10.7 Emerging Markets Rise; Japan Underperforms The emerging markets outperformed relative to the other international indices helped by global monetary policy easing and a stabilization in the price of oil and other commodities. The weakness in the U.S. dollar also helped the negatively correlated emerging markets. A weaker greenback leads to a decrease in import costs and increased export revenue for the emerging market countries. Meanwhile Japan s move to a negative interest rate policy along with the strength in the Japanese yen versus the U.S. dollar contributed to the drop in the Nikkei. International Indices Price Index Price Performance % Change Bloomberg Euro 500 228 1.4-7.7-3.0-15.5-7.7 FTSE Eurotop 100 2,596 0.3-8.8-4.7-18.2-8.8 England FTSE 100 6,175 1.3-1.1 1.9-8.8-1.1 German DAX 9,966 5.0-7.2 3.2-16.7-7.2 French CAC 40 4,385 0.7-5.4-1.6-12.9-5.4 MSCI World 1,648 6.5-0.9 4.2-5.3-0.9 MSCI EAFE 1,652 6.0-3.7 0.5-10.7-3.7 MSCI Emerging Mkts. 837 13.0 5.4 5.6-14.1 5.4 Japan Nikkei 225 16,759 4.6-12.0-3.6-12.7-12.0 Hong Kong Hang Seng 20,777 8.7-5.2-0.3-16.6-5.2 Australia S&P/ASX 200 5,083 4.1-4.0 1.2-13.7-4.0 Taiwan Weighted 8,745 4.0 4.9 6.9-8.8 4.9 India Sensex 30 Index 25,342 10.2-3.0-3.1-9.4-3.0 4 April 13, 2016
Metals Recovery Helps Canadian Small Caps Rally In the first three months of 2016, small-cap and venture stocks rallied as base and precious metal prices recovered. This led to a large outperformance of the Canadian small-cap space versus its U.S. equivalent as the Canadian equity market has a much higher concentration of metals and mining stocks. Small Cap Stocks Versus Large Cap Stocks Price Index Price Performance % Change CANADA S&P/TSX 60 INDEX 790.9 4.7 3.5 0.8-9.0 3.5 S&P/TSX MIDCAP INDEX 864.6 5.6 4.6 3.3-10.7 4.6 S&P/TSX SMALLCAP INDEX 525.2 7.1 7.8 8.1-8.4 7.8 S&P/TSX VENTURE COMP INDEX 581.1 7.3 10.5 10.8-14.6 10.5 U.S. S&P 100 INDEX 912.9 6.2 0.2 7.6 1.2 0.2 S&P 500 INDEX 2059.7 6.6 0.8 7.3-0.4 0.8 RUSSELL 1000 INDEX 1138.8 6.8 0.6 6.6-1.6 0.6 S&P 400 MIDCAP INDEX 1445.2 8.3 3.3 5.6-5.2 3.3 S&P 600 SMALLCAP INDEX 687.0 8.0 2.3 5.7-4.6 2.3 RUSSELL 2000 INDEX 1114.0 7.7-1.9 1.2-11.1-1.9 Value Leads In First Quarter Value style indices outperformed growth style indices in both Canada and the U.S. The underperformance of technology stocks in the early part of the year added to the weaker performance of U.S. growth indices. Style Indices Price Index Price Performance % Change GROWTH DJ CANADA GROWTH INDEX 1552.7-0.8-2.9-7.3-15.5-2.9 S&P BARRA GROWTH INDEX 1164.9 6.6 0.1 7.5 1.8 0.1 RUSSELL 1000 GROWTH INDX 1003.2 6.6 0.3 7.2 0.9 0.3 S&P MID 400 BARRA GROWTH 659.3 6.7 0.9 3.5-5.2 0.9 S&P 600 BARRA GROWTH INDX 507.4 6.9 0.1 3.5-4.5 0.1 RUSSELL 2000 GROWTH INDX 672.7 7.5-4.9-1.0-12.5-4.9 VALUE DJ CANADA VALUE INDEX 3074.4 7.0 6.7 6.3-4.8 6.7 S&P BARRA VALUE INDEX 889.0 6.6 1.5 6.9-2.9 1.5 RUSSELL 1000 VALUE INDX 973.7 7.0 0.9 5.9-4.0 0.9 S&P MID 400 BARRA VALUE 495.5 9.9 5.8 7.5-5.4 5.8 S&P 600 BARRA VALUE INDX 457.4 9.2 4.7 8.1-4.7 4.7 RUSSELL 2000 VALUE INDX 1395.8 7.9 1.1 3.4-9.7 1.1 5 April 13, 2016
Long-Term Returns Long-Term Returns (As Of 31-Mar-16) Return % Change (Annualized) 1 yr 2 yr 3 yr 5 yr 10 yr 15 yr 20 yr S&P/TSX Composite (price) -9.4-3.0 1.9-0.9 1.1 3.9 5.1 S&P/TSX Composite Total Return -6.6 0.0 5.0 2.1 4.0 6.5 7.6 S&P/TSX Income Trust Total Return -0.3 8.3 5.8 8.3 na na na Dow Jones Industrial Average -0.5 3.7 6.7 7.5 4.8 4.0 5.9 Dow Jones Industrial Avg TR 2.1 6.2 9.3 10.3 7.5 6.5 na S&P 500-0.4 4.9 9.5 9.2 4.8 3.9 6.0 S&P 500 Total Return 1.8 7.1 11.8 11.6 7.0 6.0 na Nasdaq Comp -0.6 7.7 14.2 11.9 7.6 6.7 7.7 FTSE 100 Index -8.8-3.3-1.2 0.9 0.3 0.6 na German DAX -16.7 2.1 8.5 7.2 5.3 3.6 7.2 France CAC 40-12.9-0.1 5.5 1.9-1.7-1.1 na Japan Nikkei 225-12.7 6.3 10.6 11.4-0.2 1.7-1.2 MSCI World -5.3-0.8 4.7 4.3 2.1 3.0 3.9 MSCI (EMU) Europe -10.2-9.1 2.4-1.9-1.9 0.9 na MSCI Emerging Markets -14.1-8.3-6.8-6.5 0.6 6.8 na MSCI Emerging Markets Total Return -11.4-4.1-2.4-2.2 3.2 na na MSCI EAFE -10.7-7.1-0.4-0.6-1.0 1.7 1.8 MSCI EAFE Total Return -7.9-4.2 2.7 2.8 2.3 na na MSCI Far East -9.1-0.2 1.3 1.6-1.5 1.2-1.0, CIBC World Markets Long-Term Returns In Canadian Dollars (As Of 31-Mar-16) Return % Change (Annualized) 1 yr 2 yr 3 yr 5 yr 10 yr 15 yr 20 yr S&P/TSX Composite (price) -9.4-3.0 1.9-0.9 1.1 3.9 5.1 S&P/TSX Composite Total Return -6.6 0.0 5.0 2.1 4.0 6.5 7.6 Dow Jones Industrial Average (in C$) 2.0 12.5 15.7 14.0 5.9 2.6 5.7 Dow Jones Industrial Avg. Tot. Ret. (in C$) 4.6 15.3 18.6 16.9 8.7 5.2 na S&P 500 (in C$) 2.1 13.8 18.8 15.8 5.9 2.6 5.7 S&P 500 Total Return (in C$) 4.3 16.2 21.4 18.3 8.2 4.6 na Russell 2000 (in C$) -8.8 5.7 14.4 12.1 4.9 4.9 6.0 Nasdaq Comp (in C$) 1.9 16.8 24.0 18.6 8.8 5.3 7.5 MSCI World (in C$) -3.0 7.6 13.7 10.6 3.2 1.7 3.7 MSCI EMU Europe (in C$) -8.0-1.4 11.1 4.1-0.8-0.4 na MSCI Emerging Markets (in C$) -12.0-0.5 1.1-0.9 1.7 5.4 na MSCI EAFE (in C$) -8.4 0.7 8.0 5.4 0.1 0.4 1.5 MSCI Far East (in C$) -6.9 8.3 9.9 7.8-0.5-0.1-1.3, CIBC World Markets, Canadian Dollar-based returns 6 April 13, 2016
Disclosures And Disclaimers Companies Mentioned In This Report That Are Covered By CIBC World Markets Valeant Pharmaceuticals International (2a, 2e, 2g, 4a, 4b, 7, 9) (VRX-NYSE, US$24.00, Sector Underperformer) Key To Important Disclosure Footnotes: 1 CIBC World Markets Corp. makes a market in the securities of this company. 2a This company is a client for which a CIBC World Markets company has performed investment banking services in the past 12 months. 2b CIBC World Markets Corp. has managed or co-managed a public offering of securities for this company in the past 12 months. 2c CIBC World Markets Inc. has managed or co-managed a public offering of securities for this company in the past 12 months. 2d CIBC World Markets Corp. has received compensation for investment banking services from this company in the past 12 months. 2e CIBC World Markets Inc. has received compensation for investment banking services from this company in the past 12 months. 2f CIBC World Markets Corp. expects to receive or intends to seek compensation for investment banking services from this company in the next 3 months. 2g CIBC World Markets Inc. expects to receive or intends to seek compensation for investment banking services from this company in the next 3 months. 3a This company is a client for which a CIBC World Markets company has performed non-investment banking, securities-related services in the past 12 months. 3b CIBC World Markets Corp. has received compensation for non-investment banking, securities-related services from this company in the past 12 months. 3c CIBC World Markets Inc. has received compensation for non-investment banking, securities-related services from this company in the past 12 months. 4a This company is a client for which a CIBC World Markets company has performed non-investment banking, non-securities-related services in the past 12 months. 4b CIBC World Markets Corp. has received compensation for non-investment banking, non-securities-related services from this company in the past 12 months. 4c CIBC World Markets Inc. has received compensation for non-investment banking, non-securities-related services from this company in the past 12 months. 5a The CIBC World Markets Corp. analyst(s) who covers this company also has a long position in its common equity securities. 5b A member of the household of a CIBC World Markets Corp. research analyst who covers this company has a long position in the common equity securities of this company. 6a The CIBC World Markets Inc. fundamental analyst(s) who covers this company also has a long position in its common equity securities. 6b A member of the household of a CIBC World Markets Inc. fundamental research analyst who covers this company has a long position in the common equity securities of this company. 6c One or more members of Investment Strategy Group who was involved in the preparation of this report, and/or a member of their household(s), has a long position in the common equity securities of this company. 7 CIBC World Markets Corp., CIBC World Markets Inc., and their affiliates, in the aggregate, beneficially own 1% or more of a class of equity securities issued by this company. 8 A partner, director or officer of CIBC World Markets Inc. or any analyst involved in the preparation of this research report has provided services to this company for remuneration in the past 12 months. 9 A senior executive member or director of Canadian Imperial Bank of Commerce ("CIBC"), the parent company to CIBC World Markets Inc. and CIBC World Markets Corp., or a member of his/her household is an officer, director or advisory board member of this company or one of its subsidiaries. 10 Canadian Imperial Bank of Commerce ("CIBC"), the parent company to CIBC World Markets Inc. and CIBC World Markets Corp., has a significant credit relationship with this company. 11 The equity securities of this company are restricted voting shares. 12 The equity securities of this company are subordinate voting shares. 13 The equity securities of this company are non-voting shares. 14 The equity securities of this company are limited voting shares. CIBC World Markets Research Rating System Abbreviation Rating Description Stock Ratings SO Sector Outperformer Stock is expected to outperform the sector during the next 12-18 months. SP Sector Performer Stock is expected to perform in line with the sector during the next 12-18 months. SU Sector Underperformer Stock is expected to underperform the sector during the next 12-18 months. NR Not Rated CIBC does not maintain an investment recommendation on the stock. R Restricted CIBC World Markets is restricted*** from rating the stock. Sector Weightings** O Overweight Sector is expected to outperform the broader market averages. M Market Weight Sector is expected to equal the performance of the broader market averages. U Underweight Sector is expected to underperform the broader market averages. NA None Sector rating is not applicable. **Broader market averages refer to the S&P 500 in the U.S. and the S&P/TSX Composite in Canada. "Speculative" indicates that an investment in this security involves a high amount of risk due to volatility and/or liquidity issues. ***Restricted due to a potential conflict of interest. "CC" indicates Commencement of Coverage. The analyst named started covering the security on the date specified. 7 April 13, 2016
Disclosures And Disclaimers This report is issued and approved for distribution to clients in Canada by registered representatives of CIBC Wood Gundy, a division of CIBC World Markets Inc., a subsidiary of CIBC, Member of the Canadian Investor Protection Fund and Member of the Investment Industry Regulatory Organization of Canada, and by its affiliates via their registered representatives. This report is not authorized for distribution in the United States. This document and any of the products and information contained herein are not intended for the use of private investors in the United Kingdom. This report is provided for informational purposes only and does not constitute an offer or solicitation to buy or sell any securities discussed herein in any jurisdiction where such offer or solicitation would be prohibited. The securities mentioned in this report may not be suitable for all types of investors. This report does not take into account the investment objectives, financial situation or specific needs of any particular client of CIBC Wood Gundy. Recipients should consider this report as only a single factor in making an investment decision and should not rely solely on investment recommendations contained herein, if any, as a substitution for the exercise of independent judgment of the merits and risks of investments. CIBC Wood Gundy suggests that, prior to making an investment decision with respect to any security recommended in this report; the recipient should contact one of our client advisers in the recipient s jurisdiction to discuss the recipient s particular circumstances. Non-client recipients of this report should consult with an independent financial advisor prior to making any investment decision based on this report or for any necessary explanation of its contents. CIBC Wood Gundy will not treat non-client recipients as its clients by virtue of their receiving this report. Past performance is not a guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance of any security mentioned in this report. Information, opinions and statistical data contained in this report were obtained or derived from sources believed to be reliable, but CIBC Wood Gundy does not represent that any such information, opinion or statistical data is accurate or complete (with the exception of information contained in the Important Disclosures section of this report provided by CIBC World Markets or individual research analysts), and they should not be relied upon as such. All estimates, opinions and recommendations expressed herein constitute judgments as of the date of this report and are subject to change without notice. Nothing in this report constitutes legal, accounting or tax advice. Since the levels and bases of taxation can change, any reference in this report to the impact of taxation should not be construed as offering tax advice on the tax consequences of investments. As with any investment having potential tax implications, clients should consult with their own independent tax adviser. 2016 CIBC World Markets Inc. All rights reserved. Unauthorized use, distribution, duplication or disclosure without the prior written permission of CIBC World Markets is prohibited by law and may result in prosecution. 8 April 13, 2016