YEAR AHEAD 2015 · debt. The ECB would have to expand its balance sheet by about 1.7 trillion euros ($2.1 trillion) to introduce quantitative easing along the lines of the U.S. Federal

YEARAHEAD2015

CONTENTSECONOMICS France and Italy struggle as the UK posts surprise growth and Germany looks homeward.— Page 2

FINANCIALSCentral banks lean toward easing as assets pile up toward $11 trillion.— Page 44

COMMUNICATIONS A year for mobile ads, Star Wars, streaming content and Internet hardware.— Page 11

BLOOMBERG INTELLIGENCEAnalytical Team— Page 86

INDUSTRIALSDeflation, weak growth and trouble in the oil industry crimp demand.— Page 62

MATERIALSSlumping prices and demand roil metals markets; China sees glitter in gold.— Page 69

HEALTH CAREPayers confront drug-makers on pricesas biotechs seek thenext blockbuster.— Page 55

TECHNOLOGYSpending rises amid more outsourcing, cloud clashes and cyber attacks.— Page 77

MARKET OUTLOOK Deflation and falling profit forecasts dim spirits; dividends provide some cheer.— Page 8

CONSUMER Cheap gasoline leaves consumers more to spend at upgraded stores and online.— Page 20

ENERGY & UTILITIESFuel prices follow crude lower; Africa suffers as U.S. shale production increases.— Page 33

WELCOME TO BLOOMBERGINTELLIGENCE

Welcome to the Bloomberg Intelligence 2015 Outlook, which highlights key topics and trends that will define business and investing in the coming year.

The book includes analyses drawn from the work of more than 200 research professionals at Bloomberg Intelligence, the five-year-old research division of Bloomberg L.P. Embedded in this year’s outlook are four broad themes:

As 2014 ended, the market appeared to be discounting a benign environment where any interest rate increases would be modest. The Federal Reserve’s stated intent to raise rates contrasts with easing by the European Central Bank and China.

As tumbling oil prices compound deflation in the euro zone, full-blown easing is becoming more likely. This would widen the gap in economic cycles globally.

Lower oil prices are a double-edged sword for European economies. They add to the deflationary risk while providing a boost to consumer discretionary income. The choices that consumers make on spending or saving could significantly aid an economic recovery or leave Europe in stagnation.

The Ukraine conflict has wide ramifications for a European economic recovery. Concern about Iran’s nuclear capabilities and related sanctions may resurface at midyear.

Our team, led by senior analysts with an average of 15 years of experience, analyzes more than 130 industries, thousands of companies worldwide and major asset classes to help Bloomberg’s customers understand what is most likely to prosper or falter. Our interactive service makes 320,000 customers immediately aware of major events and new data so they can review information graphically, read related research and reach out to investment and corporate professionals as well as our analysts through curated chat rooms.

We hope you’ll enjoy reading what our analysts have found. Contact our team if you want to know more about what we offer.

Sincerely,DAVID [email protected]

SAM [email protected]

DIRECTORS OF RESEARCHDAVID DWYER Global

DREW JONES Global Deputy

TIM CRAIGHEAD Asia

SAM FAZELI Europe, Mideast & Africa

PAUL SWEENEY North America

JULIE CHARIELL Government & Legal

NOEL HEBERT Credit

JOEL LEVINGTON Credit

CONTENT MANAGERS PATRICIA WILSON Global Product Manager

CHRIS ROGERS Global Content

GALEN MEYER Executive Editor

ECONOMIC OUTLOOKGLOBAL

For the first time since June 2006, the U.S. Federal Reserve will probably increase the target Fed funds rate in 2015, kicking off a long-term cycle of returning interest rates to a normal environment that will hold global ramifications.

Rising—yet still very accommodative— rates in the U.S. may come as welcome news, suggesting the country’s sluggish economic recovery is reaching escape velocity on improvements in business confidence and labor conditions.

Emerging-market economies that have grown dependent on cheap foreign capital to fuel growth got a preview of what higher U.S. rates may mean in 2013, when then-Chairman Ben Bernanke indicated the Fed might begin tapering its special asset purchases. That sent 10-year U.S. Treasury yields surging to 3 percent in September, almost double May’s levels.

Consequences were immediate. Higher Treasury yields triggered capital outflows from emerging markets, especially in economies with large current-account deficits, and resulted in sharply deteriorating growth prospects. From May to September 2013, the currencies of India, Brazil, Indonesia, Australia, South Africa and Turkey depreciated by more than 10 percent. South Korea experienced marginal appreciation, thanks in part to its large current-account surplus. Stability following the taper tantrum led to capital flowing back into emerging markets, creating a sense of complacency among policy makers.

Their economies will probably be caught off-guard by rising rates again in 2015.

China’s closed economy will be more insulated from the Fed’s tightening cycle than other emerging markets. Still, reform efforts and headwinds from past excesses in investment weigh on the outlook. The government will probably choose slower growth over extreme stimulus. The 2015 growth target may be reduced to 7 percent from 7.5 percent this year. The reform agenda set out at the end of 2013 remains unfinished with more work to do on interest-rate liberalization and capital-account opening. Stresses in the property and financial sectors counsel for a cautious pace on liberalization.

The European Central Bank will probably need to take additional action to reverse falling inflation expectations. The ECB may consider the inclusion of government debt in its private debt purchase program in the monetary union’s version of quantitative easing.

Policy makers have failed to take advantage of the recent period of stability —relative to the height of the euro crisis—to put the economy on the path to a lasting recovery. Many euro-area countries— including Italy, which has the world’s third-largest public debt market—are plagued by debt-to-GDP ratios that remain on unsustainable trajectories. The prolonged crisis may lead to pockets of market volatility next year inside and outside of Europe.

An unexpected recession in Japan and the results of a snap general election in December support Prime Minister Shinzo Abe’s plan to lift the economy out of its two-decade slumber. The Abenomics agenda is bold. Still, it may have come too late.

Japan faces severe demographic challenges—a quarter of its population is older than 65. It maintains a debt-to-GDP ratio of about 240 percent. The dollar’s strength against the yen, a by product of Fed tightening and Bank of Japan easing, will boost profits for Japanese businesses. The fear is that they pocket those windfall gains rather than investing them in ways that can boost growth. —

MIKE MCDONOUGHBloomberg Economist

As Rates Rise, It Will Be a Whole New Normal.

World GDP GrowthSource: Bloomberg

6

2013 2014 2015

3

4

1

5

2

0

Annualized percentage rate Consensus estimate of 37

analysts as of November 2014

2013 2014 20153.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

3.9

4.0

Annualized percentage increase Consensus estimate of 24

analysts as of November 2014

World CPI IndexSource: Bloomberg

2

3

ECONOMIC OUTLOOKEUROPE

The European Central Bank appears poised to buy a broader range of assets next year to tackle low inflation.

The monetary authorities are likely to be forced eventually to purchase sovereign debt. The ECB would have to expand its balance sheet by about 1.7 trillion euros ($2.1 trillion) to introduce quantitative easing along the lines of the U.S. Federal Reserve.

The private debt market in the euro area is too small to meet that goal. It could provide the ECB with only about 1.2 trillion euros in purchases as long as the Governing Council wishes to refrain from owning a larger share of any market than the Federal Reserve currently holds of the U.S. Treasury market—20 percent.

ECB President Mario Draghi has already hinted at the possibility of purchasing government debt. “Unconventional measures might entail the purchase of a variety of assets, one of which is sovereign bonds,’’ he told lawmakers at the European Parliament on Nov. 17.

A first step may be purchases of corporate debt. That would provide 283 billion euros in additional assets using the 20 percent rule.

The ECB has already announced a goal to increase the size of its balance sheet by 1 trillion euros. The Governing Council said it aims for that total to consist mainly of the funds lent to banks through the targeted longer-term refinancing operations as well as purchases of asset-backed securities and covered bonds, even though those categories appear insufficient.

Inflation remains well below the ECB’s de facto target of 1.9 percent on an annual basis. The headline and core readings stood at 0.4 percent and 0.7 percent, respectively, in October.

Spare capacity in the economy is likely to prevent a significant rise. The level of real GDP has still failed to return to its pre-crisis peak. It is 2.2 percent below that figure.

Growth in the year ahead is likely to be too tepid to close the gap with output. The International Monetary Fund forecasts GDP to increase by only 1.3 percent in 2015.

The economy’s expansion will be constrained by weak credit extension. Loans to non-financial corporations, adjusted for sales and securitization, declined 1.8 percent year-over-year in September and the equivalent figure for households rose only 0.6 percent. A lack of demand is likely to cause those figures to remain subdued, though they may receive some boost from banks having put the ECB’s first comprehensive assessment behind them.

Such anemic growth probably will leave unemployment elevated. The current figure —11.5 percent—stands 1.3 percentage points above the Organization for Economic Cooperation and Development’s estimate of the non-accelerating inflation rate of unemployment.

Fiscal policy is unlikely to provide any help next year. The IMF forecasts that the general government cyclically adjusted primary balance will rise to 1.4 percent of GDP from 1.2 percent in 2014. The burden of boosting demand will be left to the monetary authorities. —

DAVID POWELLBloomberg Economist

The Burden Is on ECB to Boost Economy.

2016

2014

2011

2015

2012

2013

2010

-101.5 -0.51 0.522.5

Annualized percentage rate Consensus estimate of 59

analysts as of Dec. 4, 2014

Euro Zone GDP GrowthSource: Bloomberg

ECONOMIC OUTLOOKFRANCE

MAXIME SBAIHIBloomberg Economist

France: In Search of Lost Time.

In 2015, companies will fully benefit from this year’s introduction of a new tax credit. Yet the measure is too small and complex to fully invert a decline in French firms’ profitability that led to a record high level of bankruptcies in 2014. In 2015, new measures are necessary to reverse the multi-year investment decline that was extended in 2014.

On the fiscal front, the government already decided to pause its consolidation efforts. The resulting neutral fiscal stance will not weigh on growth. Instead, the authorities are timidly hinting at structural reforms to respond to repeated demands by euro-area partners and institutions. Their implementation remains doubtful and risky in a context of high unpopularity for the executive branch. —

France has endured a rocky year and 2015 doesn’t look much better. Growth will remain constrained by high unemployment and low investment. The only identifiable bright spots that may marginally improve activity are a weakening euro and a pause in fiscal consolidation.

Household consumption, the country’s historical growth driver, is likely to remain muted as the economy will once again fail to grow enough to significantly bring down the unemployment rate. The resulting low inflation rate could persist, especially if households continue to use rising real wages to increase savings rather than consumption. There’s no reason why this should change as surveys indicate that consumers remain worried by the near-term outlook. By contrast, external demand could benefit from continuous euro depreciation because French exports are particularly elastic in response to prices.

8.4

9.2

8.8

9.6

8.6

9.4

9

9.8

10.2

10

2010 2011

French Unemployment RateSource: Bloomberg

4

ECONOMIC OUTLOOKGERMANY

Germany realized this year that it’s not immune to the euro area’s woes. In 2015, external headwinds are likely to force the authorities to rethink their approach to fiscal and monetary policies.

Germany is often portrayed as the euro area star pupil with a record low unemployment rate, a high current- account surplus and sound public finances. All this could change as soon as next year because the export-driven economy continues to be affected by the Chinese slowdown and the sluggish growth in Europe where about two thirds of its exports flow.

A rebalancing toward more internal consumption will be key, particularly with new wage agreements favorable to employees. Whether the usually prudent German households decide to convert this into more consumption remains questionable. An investment boost is unlikely given private investors’ low confidence at the end of 2014. The protracted Ukraine crisis should continue to weigh on their mood.

The public sector could step up with an investment push, notably to make up for deteriorating infrastructure. The government has resisted demands from other euro-area members and international organizations to drop its 2015 balanced budget.

Weaker-than-expected growth in Germany and the region may force the government to adjust—and therefore ease—its fiscal policy. In this context, the Bundesbank also probably will have to moderate its resistance against the European Central Bank’s use of unconventional monetary policy tools. —

5

MAXIME SBAIHIBloomberg Economist

Badge of Star Pupil Weighs on Germany.

5.6

6.4

6

6.8

7.2

5.8

6.6

6.2

7

7.4

201620142012 2015201320112010

German Trade BalanceSource: Bloomberg

ECONOMIC OUTLOOKITALY

The contraction of Italy’s economy is set to continue as the labor market and investment conditions deteriorate further. With no sign of a year-end rebound in activity, the country’s 2015 economic and political outlook is worsening.

A final GDP release confirmed that Italy has entered a recession—the third in seven years—with output contracting in the second and third quarters. The economy remains constrained by stalled household consumption, mainly because of high unemployment that reached a record 13.2 percent in October. Consumer confidence has plunged, erasing the boost that followed the appointment of a new prime minister in February.

On the supply side, investment dropped for the third consecutive quarter, extending a worrying downward trend. Investment spending is at the lowest level since 1996, down 29 percent from the pre-crisis peak.

MAXIME SBAIHIBloomberg Economist

Recession Takes Hold of Italy Again.

Only a reversal of the adverse unemployment and investment trends might steer Italy sustainably off the recessionary path.

The Italian economy is showing no sign of bouncing back, yet economists surveyed by Bloomberg still expect growth next year. The consensus forecast for 2015 GDP growth is 0.5 percent year-over-year, after several downward revisions in recent months. Further revisions may push consensus toward the zero mark.

Persistent economic weakness is also likely to increase political risk next year. While Prime Minister Matteo Renzi still enjoys a relatively comfortable approval rate, more citizens are losing patience with the euro as a currency. The Five Star Movement recently started a petition to hold a binding, nationwide referendum next year on a euro exit.

The relapse into recession might help them reach their goal. —

-5

-25

-15

-35

-40

0

-20

-10

-30

20142013

Italy Consumer Confidence IndexSource: Bloomberg

6

ECONOMIC OUTLOOKU.K.

This year economists have had to explain why, after a long period of slow growth, the British economy suddenly expanded so fast. The reasons behind it are likely to support the recovery in the coming year, yet much rests on whether productivity growth resumes and whether risks crystallize.

The seeds of this year’s recovery were sown a year or so earlier. Central Bank action in the U.K. and the rest of Europe made cheap funding available to banks, easing credit conditions and lessening uncertainty. Global commodity prices stabilized, causing inflation to fall back, and confidence rebounded.

Growth of 3 percent in 2014, as seems likely, is not to be sniffed at given what is happening elsewhere. One problem: It comes at the expense of growth in years to come. GDP would not be much higher now than at this time last year were it not for rising employment—and there is a limited supply of those willing to work.

For the U.K. economy to post a decent growth rate without stoking inflation, Britons will have to get better at their jobs, not just create more of them. This has been the problem ever since the financial crisis began and U.K. output per hour worked is no higher now than in 2007.

There are tentative signs of a productivity growth revival: GDP expanded in the third quarter while employment growth slowed and wages, which are determined by productivity gains, picked up a little.

An orderly slowdown in the rate at which slack is absorbed, together with modest gains in productivity, would see the U.K. economy expand by 2.6 percent in 2015 and 2.4 percent the year after. Unemployment would soon approach its long-term natural rate of about 5 percent and, aided by low inflation, real wage growth would return in a form people recognize, reaching 2 percent over the next year or so.

That scenario would be consistent with the Bank of England lifting interest rates toward the middle of the year and tightening gradually thereafter. Interest rates are likely to remain below historical norms for years to come, both because the natural rate is lower and fiscal austerity necessitates monetary accommodation. —

JAMIE MURRAYBloomberg Economist

U.K. Growth Hinges on Productivity Gains.

7

MARKETOUTLOOK

U.S., European Gap Widens on Russia, Oil, Emerging Markets Rout

Europe Telecom P/E Multiples Boast Biggest Expansion in 2014

MARKET OUTLOOK

EQUITIES 9

MARKET OUTLOOK

EQUITIES 10

European Bank Payouts Set to Surge in 2015 as Telecoms Slow

EU Economic Gloom Spells Deeper Cuts to Profit, Sales Estimates

COMMUNI- CATIONS

COMMUNICATIONSEntertainment M&A Simmers on DreamWorks, MSG as Pay-TV Merges

TV Advertising Hits Weak Spot as Viewers, Budgets Shift Online

ENTERTAINMENT 12

COMMUNICATIONS

ENTERTAINMENT 13

Star Wars ‘Force’ Awakens $11.8 Billion Record 2015 Box Office

HBO, CBS Fly Over-the-Top, Walk Content-Distribution Tightrope

COMMUNICATIONSMobile Ad-Measurement Progress May Disrupt Google Dominance

Instant-Messaging’s Rapid Expansion Boosted by Engagement, M&A

ENTERTAINMENT 14

COMMUNICATIONS

ENTERTAINMENT 15

Automated Online Ad-Buying Helps Internet Lure TV Dollars

Google, Facebook Hardware Ambitions Amplify on Digital Content

COMMUNICATIONSEU Telecoms May Get Boost From Data, Regulation, Emerging Markets

European Telecom Industry Capital Spending to Remain Elevated

TELECOMMUNICATIONS 16

COMMUNICATIONS

TELECOMMUNICATIONS 17

Europe’s Carriers Will Get Ready to Spend on Spectrum Auctions

Consolidation Drive Set to Keep European Telecom Deals Alive

COMMUNICATIONSEU Pay-TV Key Revenue Drivers Are Broadband and Multi-Play

European Cable Margins Climbing, Even With Marketing Pressure

CABLE & SATELLITE 18

COMMUNICATIONS

CABLE & SATELLITE 19

Cable 2015 Cash Flows Supported by Decline in Capital Intensity

EU Pay-TV Trails Stoxx After 5 Years of 200%-Plus Outperformance

CONSUMER

CONSUMERRussia Auto Demand May Be Muted as Sanctions, Oil Cut GDP Growth

Europe Leaning on Credit, Scrapping Faces Auto Demand Dearth

AUTOS 21

CONSUMER

AUTOS 22

U.K. Leads Europe Autos Into 2015 as Key Countries Stay Sluggish

Small Crossovers May Spark Vehicle Demand Renaissance in Europe

CONSUMERPrimark, Zara, Boss Amplify Spending on Stores to Keep Shoppers

Mobile to Push Online to Bigger Share of European Apparel Retail

RETAIL 23

CONSUMER

RETAIL 24

Rapid Online Gains Spur Europe Retailers to Competitive Internet

European Retailers Boost Spending, Online Still Requires Capital

CONSUMERLuxury Goods Growth to Slow to 3.5% in 2015 as Asia Normalizes

Affordable Accessories Buoy Luxury as High-Priced Clothing Flags

LUXURY GOODS 25

CONSUMER

LUXURY GOODS 26

Luxury Goods’ 25% Superior Online Sales Growth the New Must-Have

Currency Impact a Sensitive Topic for Luxury Makers, Shoppers

CONSUMERGlobal Beverage Sales May Increase 2% to 3% Annually to 2018

Global Beverage Margins May Be Bolstered by Manageable Costs

BEVERAGES 27

CONSUMER

BEVERAGES 28

Beverage Spending May Stay Flat Even Amid Higher U.S. Confidence

Wine Sales Outpace Beer and Spirits to Spur Home Alcohol Sales

CONSUMEREurope Food Deflation Persists on Slow Economy, Stifles Margins

EU Food Packers Forced Deeper Into Emerging Markets for Growth

FOOD 29

CONSUMER

FOOD 30

Sluggish West Europe Packaged Food Sales Abrogate Global Gains

EU Food Maker Sales, Adjusted EPS Set for Forex Recovery in 2015

CONSUMERClick & Collect May Spread as Food Retailers Seek Online Profits

Aldi, Bim, Biedronka Outpace Rivals by Catching Consumer Spirit

FOOD RETAILING 31

CONSUMER

FOOD RETAILING 32

Convenience to Dwarf Discount, Online as Supermarkets Shrink

Rise in Home Alone Shoppers Set to Fuel Convenience Store Sales

ENERGY& UTILITIES

ENERGY & UTILITIESAre North American Integrated Oil Companies Relics of the Past?

Integrated Oil Model Trumps Independents During Times of Stress

INTEGRATED OIL 34

ENERGY & UTILITIES

INTEGRATED OIL 35

Iran Oil Unlikely to Flood Markets in 2015 Even If Sanctions End

Oil Majors’ Surging Capex May Force Higher Crude Prices in 2015

ENERGY & UTILITIESIntegrateds’ Dividend Coverage May Be Resilient After Oil Drop

More U.K. Fracking Protests May Be Ahead as Shale Support Wanes

EXPLORATION & PRODUCTION 36

ENERGY & UTILITIES

EXPLORATION & PRODUCTION 37

U.S. Shale Oil Robs West Africa of Major Crude Oil-Export Market

Iran Gas Shipments to EU May Take Five Years After Sanctions End

ENERGY & UTILITIESWeak Demand, Overcapacity Prominent in EU Refining Space in 2015

Cheaper West African Crude May Be More Attractive to EU Refiners

REFINING & MARKETING 38

ENERGY & UTILITIES

REFINING & MARKETING 39

Total, BP Refining Margins May Fade in 2015 as Capacity Returns

Fuel Prices in Europe Follow Crude Plunge, May Remain Low in 2015

ENERGY & UTILITIESSolar Energy Demand Surge Is Anticipated on U.S., China Policy

Wind Energy Installs May Increase as China, U.S. Review Subsidy

ALTERNATIVE ENERGY 40

ENERGY & UTILITIES

ALTERNATIVE ENERGY 41

California May Spark Utility-Scale Battery Energy-Storage Demand

U.S. Exports, Cellulosic Fuel Output Offer 2015 Biofuel Growth

ENERGY & UTILITIESEurope Power Demand to Resume Growth in 2015 as Economy Improves

RWE, Fortum Margins to Fall, Centrica Gain as Hedges Rolled Over

UTILITIES 42

ENERGY & UTILITIES

UTILITIES 43

E.ON, GDF Suez Gas Costs May Fall Within Six Months on Crude

Enel, GDF Suez Gas-Fired Power Plant Utilization May Stabilize

FINANCIALS

FINANCIALSEU Bank $365 Billion Sovereign-Loan Switch May Turn Tide for ECB

Bank AT1 Issuance Set to Flourish in 2015 Following $65 Billion

COMMERCIAL BANKS 45

FINANCIALS

COMMERCIAL BANKS 46

Draghi $800 Billion Target Key for 2015, Deflation Threat Grows

Asset Purchase Program, December LTRO Key to Euro GDP in 2015

FINANCIALSGlobal Investment Banks Seek Cyclical Revenue, Profit Recovery

Central Bank Assets of $11 Trillion and Growing May Pose Risk

INVESTMENT BANKS 47

FINANCIALS

INVESTMENT BANKS 48

Global Bank Too-Big-to-Fail Regulation May Drive Higher Costs

Legal Risk Extends for Global Banks, Though Costs May Fade

FINANCIALSExchange Volumes Are Dependent on Return of Price Volatility

Recovery From Spain to Dubai May Boost $219 Billion of IPOs

EXCHANGES 49

FINANCIALS

EXCHANGES 50

Dark Pools Battle Exchanges for $24 Trillion Stock Market Share

Shanghai-Hong Kong Stock Connect Paves Way for Asian Exchanges

FINANCIALSCyber Attack, Terrorism, Climate Change Top Emerging Risks

Reduced Mortality Rates Raise Demand for Managing Longevity Risk

INSURANCE 51

FINANCIALS

INSURANCE 52

Swelling Cyber Attack Risk Is Driving Wider Insurance Coverage

Dry Spell for Catastrophe Bonds May Give Way to Renewed Activity

FINANCIALSEuropean Insurers Face Critical Year as Solvency II Enforced

Controversial G-SII Capital Charges Set to Be Determined in 2015

INSURANCE 53

FINANCIALS

INSURANCE 54

Deflation Concerns Spark EU Insurers’ Japanese Scenario Concerns

Advanced Car Technology May Spur 10% Motor Claims Drop by 2025

HEALTHCARE

HEALTH CARELarge Pharma’s Innovation Will Be Key Yardstick in 2015 Strategy

J&J Remicade Biosimilar in Europe First to Test Extent of Threat

PHARMACEUTICALS 56

HEALTH CARE

PHARMACEUTICALS 57

Drug Price Tug-of-War Likely in 2015 as Payers Flex Their Muscle

Make or Break for Some Drugs With Major Outcome Trials in 2015

HEALTH CAREWill the Biotech Industry Indexes Be Able to Sustain Growth?

Biotech IPOs May Be in for Another Strong Year If Economy Holds

BIOTECHNOLOGY 58

HEALTH CARE

BIOTECHNOLOGY 59

Biotech Industry Catalysts Galore, Yet Which Will Bear Fruit?

Biosimilars ‘Patent Dance’ Suits to Clarify Timing, Legal Costs

HEALTH CAREDefibrillator Sales May Continue to Decline for Medtronic, Peers

U.S. Orthopedic Growth May Continue to Rise, Aid Zimmer, Stryker

MEDICAL DEVICES 60

HEALTH CARE

MEDICAL DEVICES 61

Medical-Device M&A at 10-Year High May Offer Spoils to Onlookers

Edwards, Medtronic Heart Valves May Propel Sales Growth in 2015

INDUSTRIALS

INDUSTRIALSIndustrials Sales Pressured as Smaller Oil, Gas Spending Slips

Weaker Oil May Leave Shale-Driven Industrial Equipment Unharmed

INDUSTRIALS 63

INDUSTRIALS

INDUSTRIALS 64

Industrials Price Pressure May Intensify as Input Costs Decline

Weak Growth, Deflation Take Industrial Demand From Bad to Worse

INDUSTRIALSNorth America Leads Machinery Sales Forecast With Europe a Risk

Mining Capital Spending Cuts Are Cushioned by Parts, Services

MACHINERY 65

INDUSTRIALS

MACHINERY 66

Global Farm Equipment Demand May Stay Weak on Low Grain Prices

North America 7% Growth to Lead Construction Equipment Demand

INDUSTRIALSFalling Fuel Prices May Trim Airline Costs; Whither Competition?

Europe’s Slowdown Weakens Airline Pricing Power, Euro Hurts

AIRLINES 67

INDUSTRIALS

AIRLINES 68

Short Haul Provides No Haven for European Airlines on Yields

European Airlines Struggle to Profit Overseas Amid Overcapacity

MATERIALS

MATERIALSCopper Markets Expect New Mines, Smelters and China Buying

China Copper Output May Rise in 2015 on Capacity, Higher Charges

METALS & MINING 71

MATERIALS

METALS & MINING 72

Nickel Deficit by 2020 Is Inevitable Even If Indonesia Ban Ends

China May Turn to Stronger Aluminum Markets Overseas Next Year

MATERIALSIron Ore Prices Plunge 42% With More Record Supply Coming

China Steel Capacity May Peak in 2015 as Cuts Finally Take Hold

METALS & MINING 73

MATERIALS

METALS & MINING 74

China Gold-Mine M&A Spree May Accelerate on Metal-Price Slump

China’s Hong Kong Gold Imports Reach Five-Month High Before Holiday

MATERIALSFertilizer’s Future Hangs on Asian Government Subsidies, Tariffs

Petro Chemical Returns Reallocated by Oil Flows in Slow-Growth World

CHEMICALS 75

MATERIALS

CHEMICALS 76

Chemicals Earnings Outlook Brings Deja Vu, Yet This Time With Low Oil

Specialty Chems May Be Reshaped by M&A as Diversifieds Dissolve

TECHNOLO GY

TECHNOLOGYAmazon, Google, Microsoft Cloud Price War Squeezes Smaller Peers

License Revenue of Software Vendors Will Remain Under Pressure

SOFTWARE 78

TECHNOLOGY

SOFTWARE 79

Emerging Analytics Software Providers to Create More Competition

Cybersecurity Spending May Ramp Up in 2015 as New Threats Emerge

TECHNOLOGYPC Stability May Spread From Corporations to Consumer

Amazon-Led Cloud Model Promotes Hardware Commoditization

COMPUTER HARDWARE 80

TECHNOLOGY

COMPUTER HARDWARE 81

Solid-State Drives, Cheap Hard Disks Polarize Storage in 2015

Larger Phones, PC Use Leaves Tablets Stuck in the Middle

TECHNOLOGYWearables Hype Will Be Put to Test With Apple Watch Next Year

Game On for Sony, Microsoft as Titles to Fuel Console Sales Jump

CONSUMER ELECTRONICS 82

TECHNOLOGY

CONSUMER ELECTRONICS 83

4K, Bigger Panel Sizes, Falling Prices Likely to Boost TV Demand

China LCD Makers Play for $50 Billion Market With New Capacity

TECHNOLOGYApple’s Larger iPhones Raise Ante in Premium Smartphone Segment

Xiaomi, Lenovo Geographic Expansion Threatens Entrenched Vendors

MOBILE PHONES 84

TECHNOLOGY

MOBILE PHONES 85

IOS, Android Jockey for Position in Nascent Internet of Things

Emerging Analytics Software Providers to Create More Competition

DIRECTORS OF RESEARCHDAVID DWYER Global Research

SAM FAZELI European Research, Pharmaceuticals

PAUL SWEENEY North American Research, Media and Internet

TIM CRAIGHEAD Asia Research, Gaming and Lodging

NOEL HEBERT Credit Research, Consumer

JOEL LEVINGTON Credit Research, Industrials

JULIE CHARIELL Government, Legal and ESG Research

DREW JONES Global Research Deputy

ANALYSTSECONOMY & STRATEGYMICHAEL McDONOUGH Chief Economist

THOMAS ORLIK Economics

DAVID POWELL Economics

CARL RICCADONNA Economics

JOSH WRIGHT Economics

COMMUNICATIONSERHAN GURSES Telecom and Media, Europe

PRAVEEN MENON Internet Media

GEETHA RANGANATHAN Media, North America

PAUL SWEENEY Media and Internet, North America

ALEX WISCH Telecom and Media, Europe

CONSUMERDEBORAH AITKEN Luxury Goods, Food and Household Products

CHARLES ALLEN Retail, Europe

TIM CRAIGHEAD Gaming and Lodging

BLOOMBERG SENIOR ANALYSTS & ANALYSTS

86

87

TOMASZ NOETZEL Banks, Europe

JENNIFER RAY European Financials

KAPILAN THEIVENTHIRAMPILLAI Banks, Europe and Middle East Exchanges, Global

JONATHAN TYCE Banks, Europe and Latin America

ALISON WILLIAMS Banks, North America Investment Banking and Asset Managers, Global

HEALTHCARESAM FAZELIPharmaceuticals

ASTHIKA GOONEWARDENE Pharmaceuticals

JASON MCGORMAN Healthcare Services and Medical Devices

INDUSTRIALSHEENAL PATEL Industrials, Europe

BRIAN MILLER Gaming and Lodging

KENNETH SHEA Food and Tobacco

KEVIN TYNAN Automotive

ENERGY & UTILITIESPHILIPP CHLADEK Oil and Gas, Europe

ANDREW COSGROVE Oil and Gas Services, Coal

JAMES EVANS Renewable Energy

WILLIAM HARES Oil and Gas, Europe

ELCHIN MAMMADOV Utilities, Europe

VINCENT PIAZZA Oil and Gas, North America and Integrated Oils, Global

FINANCIALS EDMOND CHRISTOU Insurance, Europe

CHARLES GRAHAM Insurance, Europe

RENE LEJEUNE KING Banks, Europe

JOHNSON IMODE Industrials, Europe

KAREN UBELHART Industrials and Machinery

MATERIALSSONIA BALDEIRA Construction Materials

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