More hit and miss lists for 2012

Equities will show modest double digit returns but for the best part of the year will be
range bound, in our view.

The implicit faith equity investors have in policy makers will be tested again and may mean
trendless markets until QE is adopted.

The global economy is hitting a growth speed-bump at the same time as it is attempting to
rebalance itself following the 2008 financial crisis.

The developed world is still locked into a series of competitive devaluations as they try
desperately to restore competitiveness to their economies.

Emerging markets have temporarily overheated and may take longer to recuperate.

Unless EU sovereign credit markets are allowed to clear, global equities will experience
painful bouts of volatility.

We would expect an M&A boom in 2012 as companies grow market share by acquiring competitors and cutting
costs to maintain ROE.

Ultimately, the major investment theme for 2012 will be the time to buy European equities.

Watch out for a fall in the euro, ECB QE and panic within the EU banking system to go overweight.

ASIA

Nikkei 225       8,450        +0.60%
Hang Seng    18,877        +2.40%
Shanghai        2,304        +1.19%
S&P ASX        4,155        +1.08%
Sensex          15,924       +2.62%
GlobalDow    1,824          +0.57%

EUROPE

FTSE 100      5,639    +1.20%
CAC 40         3,211    -0.36%
DAX              6,160    +1.39%
FTSE MIB      15,595   +0.91%
IBEX 35 IDX   8,656    -0.77%
GlobalDow    1,824    +0.57%

China

- Dec official Services PMI rebounds to 56.0 from 49.7 - CFLP

Singapore

- Q4 GDP shrinks, recession looms
- Q4 GDP falls s/adj, annualised 4.9% vs. Q3 vs. forecast -5.5% q/q
- Q4 GDP +3.6% y/y as expected
- Estimates for Q1, Q2 and Q3 revised downwards
- Singapore economy grew 4.8% y/y in 2011 vs. forecast 5.0% y/y
- Q4 Manufacturing -21.7%
- Increased chances of a technical recession
- Most economists expect cbank to keep policy stance in April
- Singapore Q4 private home prices +0.2 pct vs Q3

Source: Reuters