Epstein Secrets

ico} ico} SSR ERE EERE ES SSR eRe EER EES Source: Bloomberg Source: Bloomberg 4 Global Cross Asset Strategy -

16 Bankof America 2 Merrill Lynch HOUSE_OVERSIGHT_014435 --- PAGE BREAK --- Chart 3: EM debt and equity have been hit Chart 4: While Banks versus Staples has gone ballistic 950 r 40 0.43 ——MSCI EM _ 900 SSW eG TRS EN LSI SEE ERG ; , ———S&P 500 Banks relative to Food & Bev 0.39 (RHS) 850 0.37 0.35 800 0

(SD) Source: BofA Merrill Lynch Global Research, Bloomberg Chart 5: Financials valuations have recovered si

relative price vs 52wk average (SD) Source: Re BofA Merrill Lynch Global Research, Bloomberg place this text Chart 6: Rapid relative de-rating for Staples — relative PE for Food & Beverage still 6-10% above 2010 / 2014 levels 1.70 1.60 1.50 1.40 1.30 1.20 =———PE-relative FOOD & BEV 110 eee German

ctor Est. cash Overseas cash Effective tax Net % imported vs Sector overseas ($bn) = % mkt cap rate LTM exported COGS Discretionary 15 2.9% 28% -14% Staples 68 3.2% 29% -13% Energy 39 26% 21% -3% Health Care 187 10% 23% A% Industrials 127 6.0% 26% 1% Technology 647 14.9% 20% -9% Materials 24 40% 23% 3% Te

0.1 0.1 0.1 Utilities 0.2 0.2 0.2 0.2 S&P 500 ex. Financials & Real Estate 117.0 102.4 78.3 68.5 S&P 500 GAAP EPS impact ($9) ($8) Source: FactSet, Blaomberg, BofAML Global Research estimates, BofA Merrill Lynch US Equity & US Quant Strategy We estimate share buybacks add $4 (or as high as $6) to EPS (GAA

(RHS) Source: BofA Merrill Lynch Global Research, Bloomberg. Daily data from Jan-90 to 5-Jun-17. The politic

SPX puts conditioned on higher rates Participate in the continuation of the reflation trade. Cheapen Financials upside by selling rich Utilities and Staples vol & expensive correl. Higher US rates and stronger dollar are likely to hurt companies exposed to EM and help US DM. Trade the outperformance in a