EFTA01173321.pdf

From: US GIG To: Undisclosed recipients:; Subject: JPMorgan View 01.27.2012 Date: Fri, 27 Jan 2012 23:26:26 +0000 Attachments: JPM_View_01.27.2012-pdizip Inline-Images: intage0O3.png J.P.Morgan Slobs, asset Allocelion J P Morgan Close Sara NA. 4 P Morgan Occurnud lea Jan 27.2012 The J.P. Morgan View The rally is getting fundamental support • Aviel Allocation— Start switch from the to intoEM Jan Looys' • Economies — Suave P%Us create upside task an global glossa SW ruse 91 tone in the EuroArea. and 2012 front 0.3% o.0 4%.mth upside risk • Fixed Income —wk stay tactically prune on at prophesy • Equities — 11k teconimend a basket of high and sustainable thadend yield arks. the l.P. Morgan European Eustamabk Held Basket with an rimer SOL 'rtzoglou Deld of 4 7% • Credit — CS H1' reMain3 our prefened trait. stay long - rain • Foreign exchange — ilk mace defensive trade again and add another LISD short • Conutiorleles —Close long bend vs base metals wade. Ream long gold Matthew Lehmann • %%Mk fOur and the rally m ask assets continues. earn as US equities are beaded for tau first tri weekly down of dr year Last week we saw that the rams wench had staled in equities. was pupate along mat. ronunodaties and EM CUrrenCitS This mown the case this week. and now ha-, widened further to the eumproptra But we are also grning fundamental support. with unproved economic data and central banks :mann even fur her easing ilk are flan truss challenged by overvaluance and baba pantos and thus feel n0 returns through an 2e condonable :Maing a ugnsficant long in ruk assets. % tome auntie, aloe Phlls remain our best forma looking indicators of economic runty. despite tad subpar performance as a global signal last )eat And it is the flash IGO or PhIls for Chula and Europe that am now indicating upside task on global IAD treader forecasts for 91 In theism are. this has forced us already to Onus EII from 1/306seiso I Tr% to Bar winch fair: the 2012 popectal Isom -0 3% to 4% Mt eau SILPSoa next week's surreys on credit mothball to assess whether the moon Tow imam: in a shallow recession. or is poi homong woad stagnation EM FI Equally Ulicertant are Signs dim central banks are pang themsehes men Weep ass more into a stimulus stance The FOMC stated this week that it does not c£Min expect to rase rates fa another flute years. almost 3 year later than the moat PAM* had expected. And Clam= Bernina made it clear that it would non take EM Loot Barer much for the FOMC to start rah" nand of QE In Eunice. arse is !somas confidence that the Dernatet 3+year loon from the ECB is ka0ing banks to BOX use al least sane of that to buy sovereign fete wk expect banks to take up 11611.0itre 03 30 4000n at me try L I RO reFeb N. of MuchE230-300ba would be new Le Fred krone money In EM. the Resent Bank ofIota gave us a striate 0 X% chop in Gail Goo BON' seam requirements This may non signal a big change. but we do expect rate ruts from Q2 on as inflation is falling Overall. both DM andEM central banks ErneReethroW have become more growth supportive o er the past month. Ware O I • The strong and widening rally us nit assets may give the unpresuon that the obleak Roe" Gamma t▪ her unmeant Cannansity LS humans bullish about the weld ibbAner. weak ••••••..mip0 be Panes • 0.000001 Was .403m' DIP0 $010/14a0 Pilala trading volumes. sunrys. united tar and client canversanons meal nioare•s www.morganmarkets.com Ta cemfyinp analyst is Indicated by ao "c. See page 7 for anal>, catacance and amponant legal and reguaory dialogs This email is confidential and subject to important disclaimers and conditions including on offers for the purchase or sale of securities, accuracy and completeness of information, viruses, confidentiality, legal privilege, and legal entity disclaimers, available at Imp://vAvw.jpmorgan.com/pagesidisclosures/entail. EFTA01173321