Hanson – The Outlook for 2015

January 2015

In assessing the market outlook for 2015 there are several factors to consider. However, the big issue at the moment, in January, is the oil price. The sharp decline in the oil price over the past few months is bad news for oil producers and anybody supplying them. However, it is good news for everyone else as it is the equivalent of a substantial tax cut which means everyone will have more money to spend on other things. Looking at it another way people who produce oil rarely spend the profits, but those who buy it are big spenders and will appreciate a few extra dollars in their pocket. Putting this into numbers, the IMF estimates that a US$25 fall in the oil price should add around 1% to global growth over the following three years and as Brent crude has fallen some US$70 from its US$118 high in 2014 this implies a positive impact on global growth of nearly 3%.

Looking at the bigger picture recent economic data has been mixed and there are clearly major problems in the global economy, but there are as yet few signs the world is slipping into a major recession. Given our top down approach to asset allocation and stock selection we will consider the major markets in turn.

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Disclaimer:

This document is provided to you for information purpose only and in good faith. It should not be used or considered as an offer or a solicitation to sell or buy the securities mentioned in it. Any decision by an investor to make investments should be based on advice from an independent financial advisor.

Nothing in this document should be construed as investment advice, or as an opinion regarding the appropriateness or suitability of any investment. This presentation does not take into account the particular investment objectives, restrictions, financial or tax situation or needs of any specific client. This document may not necessarily represent the views of Hanson Asset Management in every respect nor may they translate directly into the asset allocations Hanson Asset Management determines to be suitable for particular clients. No representation is made that the objectives or goals of any investment fund will be met or that an investment will be profitable or will not incur losses.

This material is for distribution only under such circumstances as may be permitted by applicable law. It has no regard to the specific investment objectives, financial situation or particular needs of any recipient. It is published solely for information purposes and is not to be construed as a solicitation or an offer to buy any assets, securities or related financial instrument. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the investments, assets, securities, markets or development referred to in the materials. It should not be regarded by recipients as a substitute for the exercise of their own judgement. Any opinions expressed in this material are subject to change without notice. Neither Hanson Asset Management, nor any of the directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of this material.

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