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INTERNATIONAL EQUITY
Chris Alderson
Head of International Equity
November 17, 2016
2017 Global Market Outlook Press Briefing
2
The Bull Market No One Loved
*Begins on March 9, 2009, which was the low point for the S&P 500 during the financial crisis.
Past performance cannot guarantee future results.
Sources: FactSet, Standard & Poor’s, and MSCI. Returns in USD.
+276%
+146%
+130%
+111%
100
150
200
250
300
350
2009 2010 2011 2012 2013 2014 2015 2016
IndexLevel(100=3/9/2009)
REGIONAL RETURNS
March 2009*–September 2016
S&P 500
MSCI Europe
MSCI Emerging Markets
MSCI Japan
“The Death of Equities?”
3
The Scarcity of Growth
As of September 30, 2016
Source: FactSet.
7.1 7.0
6.7
5.1
3.1 3.0
2.5
2.0
0.6
-1.2
-2.4
2.6
1.5 1.5
1.1
0.4
-4.0
-2.0
0.0
2.0
4.0
6.0
8.0
RealGDPGrowthYoY%
REAL GDP GROWTH
YEAR-OVER-YEAR (%)
-40
-20
0
20
40
60
80
100
120
140
2007 2008 2009 2010 2011 2012 2013 2014 2015
Emerging Markets Europe ex UK
Japan United Kingdom
United States
REGIONAL PROFITS (EPS IN USD)
In USD Since Last Cycle Peak (October 2007)
4
The Hope for Growth
As of September 30, 2016
Sources: Ministry of Health, Labour & Welfare; Statistical Office of the European Communities; Bureau of Labor Statistics; Haver Analytics; and
Morgan Stanley Research.
-5
-4
-3
-2
-1
0
1
2
3
4
2004 2006 2008 2010 2012 2014
Year-Over-Year%Growth
EMPLOYMENT GROWTH BY REGION
Japan
EU
US
CORPORATE EARNINGS—WHERE NEXT?
Falling Rates
Rising Earnings
Higher Rates
Rising Earnings
Falling Rates
Falling Earnings
Higher Rates
Falling Earnings
MOST BULLISH
MOST BEARISH
?
5
Growth Motoring, Markets Rotating
As of September 30, 2016
Past performance cannot guarantee future results.
Sources: MSCI, total return indices used for MSCI Value and MSCI Growth. Source for MSCI data: MSCI. MSCI makes no express or implied warranties or
representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a
basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI.
80
100
120
140
160
180
200
220
240
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
MSCI WORLD VALUE—MSCI WORLD GROWTH
Total Return Indexed to 100
Value - Growth Mean -1 St Dev
-2 St Dev +1 St Dev + 2 St Dev
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
TOTAL RETURN (%)
Dec. 31, 2014‒Feb. 11, 2016
Feb. 16, 2016‒Sept. 30, 2016
6
Economic Inequality and the
Protest Vote
As of December 31, 2015
Sources: FactSet, Haver Analytics, Standard & Poor’s, Bureau of Economic Analysis, Federal Reserve Board, Tax Policy Center, Citizens for Tax Justice,
and T. Rowe Price.
*Equal-weighted total return of U.S. equities (S&P 500) and U.S. 10-year government bonds.
0%
5000%
10000%
15000%
20000%
25000%
30000%
40%
42%
44%
46%
48%
50%
52%
54%
1950 1960 1970 1980 1990 2000 2010
CumulativeReturn
NAICSU.S.Wagesas%ofGDP
Wages as % of GDP
Equal-Wtd Equity and Bond Blend*
WALL STREET BOOM, MAIN STREET BUST
1950‒2015
BREXIT
7
Profits—U.S. Economy Versus
the S&P 500 Index
Sources: Deutsche Bank Research and Haver Analytics.
Service industries are: financials; multiline retail; specialty retail; Internet and
catalogue retail; diversified consumer services; hotels, restaurants, and
leisure; IT services; health care providers; and services.
86%
32%
14%
68%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Share of U.S. Employment Share of S&P 500 Earnings
THE U.S. ECONOMY VS.
THE S&P 500 INDEX
As of October 31, 2015
Service Industries Manufacturing/Goods Producing Industries
65%
43%
42%
34%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
2008Q1
2013Q2
2013Q3
2013Q4
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3(E)
2016Q4(E)
2017Q1(E)
2017Q2(E)
2017Q3(E)
2017Q4(E)
CumulativeGrowthinOperatingEarningsPerShare
EARNINGS GROWTH BY SECTOR
2013—2017E
S&P 500 Health Care and Information Technology
S&P 500 Financials and Utilities
S&P 500 Consumer Discretionary and Consumer Staples
S&P 500 Energy, Industrials, and Materials
2013Q1
8
Europe’s Pain
As of September 30, 2016
Past performance cannot guarantee future results.
Source: FactSet.
U.S. VS. EUROPEAN EQUITIES
RELATIVE PRICE PERFORMANCE (USD)
EUROPE AS A % OF WORLD MARKET
CAPITALIZATION
20%
22%
24%
26%
28%
30%
32%
34%
36%
38% MSCI Europe Market Cap Relative to World Market Cap
40
50
60
70
80
90
100
110
120
130
1969
1972
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
2011
2014
S&P Minus Europe
Mean
-1 St Dev
+1 St Dev
9
European Profits—Why so Bad?
Chart is shown for illustrative purposes only and does not represent the performance of any specific security.
Sources: FactSet and MSCI.
-26.4%
-13.4%
-11.6%
-6.8%
-3.0%
0.4%
1.4%
1.9%
2.4%
3.3%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
MSCI EU: CONTRIBUTION TO
EARNINGS CHANGE BY SECTOR
October 2008 to August 2016
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
60%
65%
70%
75%
Oct-08
Apr-09
Oct-09
Apr-10
Oct-10
Apr-11
Oct-11
Apr-12
Oct-12
Apr-13
Oct-13
Apr-14
Oct-14
Apr-15
Oct-15
Apr-16
MSCI EU INDEX: PERCENT OF EARNINGS
FROM ENERGY, MATERIALS, AND FINANCIALS
October 2008‒August 2016
Energy
Materials
Financials
60%
18%
10
0
2
4
6
8
10
12
14
16
18
20
22
Yen(Trillion)
FY
TOTAL SHAREHOLDER RETURNS
OF ALL LISTED COMPANIES
On a Common Stock Basis 1990‒2017 (Est. for 2016‒2017)
Dividends
Share Buybacks
Japan—What Is Changing
As of July 31, 2016
Past performance cannot guarantee future results.
Sources: Corporate Reports, Japan Exchange Group, and Empirical Research Partners Analysis.
Data exclude financials and utilities. Share buybacks are net of share issuance.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1st
Section
2nd
Section
Mothers JASDAQ Total JPX-Nikkei
400
JAPANESE SHARE OF STOCKS
WITH INDEPENDENT DIRECTORS
BY LISTING CATEGORY
2014
2015
11
China—A Hard Landing Within a
Soft Landing
As of September 30, 2016
Sources: FactSet, Haver Analytics, and China National Bureau of Statistics.
4
6
8
10
12
14
16
Year-Over-Year%Change
CHINA: REAL GDP GROWTH
January 2005–June 2016
51%
30%
35%
40%
45%
50%
55%
Servicesas%ofGDP
CHINA: SERVICES SHARE OF THE ECONOMY
1992‒2Q16
12
Emerging Markets—Rates Down as
Inflation Abates
Sources: Various National Statistical Agencies, Haver Analytics, and T. Rowe Price.
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
2010 2011 2012 2013 2014 2015 2016
Year-Over-Year%Change
EMERGING MARKET INFLATION
January 2010–August 2016
India
Brazil
China
Russia
0%
02%
04%
06%
08%
10%
12%
14%
16%
18%
20%
2010 2011 2012 2013 2014 2015 2016
EMERGING MARKETS
CENTRAL BANK RATES
January 2010–September 2016
India
Brazil
China
Russia
13
Emerging Markets: Uncertainty and
Opportunity
Sources: FactSet and Empirical Research Partners Analysis.
Top quintile compared with sector average.
VALUATIONS REFLECT CHANGE
AND UNCERTAINTY
12-Month Forward P/E as of September 30, 2016
0 5 10 15 20
Mexico
India
Philippines
U.S.A.
Indonesia
Malaysia
The World Index
Chile
Europe
South Africa
Thailand
Taiwan
Japan
Brazil
Czech Republic
Peru
Greece
China
Qatar
United Arab Emirates
Colombia
Poland
Hungary
Egypt
South Korea
Turkey
Russia
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
StandardDeviation
EMERGING MARKETS VALUATION SPREADS
The Top Quintile Compared With the Market Average
January 1992‒September 2016
Valuation Spread
1 Standard Deviation
-1 Standard Deviation
One Standard
Deviation
Average
NARROW
DISPARITIES
WIDE
DISPARITIES
14
Multiples Have Expanded, but Extremes
(or Crises) End a Cycle
As of September 30, 2016
Past performance is not a reliable indicator of future performance.
Sources: FactSet and MSCI. Source for MSCI data: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever
with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial
products. This report is not approved, reviewed, or produced by MSCI.
5
7
9
11
13
15
17
19
21
23
25
27
29
Price-to-EarningsRatio
DEVELOPED VS. EMERGING MARKETS
12-Month Forward P/E
January 1996–September 2016
MSCI World
LT AVERAGE
MSCI EM
LT AVERAGE
MSCI World Long-
Term Average
16.2x
MSCI EM Long-
Term Average
11.8x
0
10
20
30
40
50
60
70
80
90
100
1993 1996 1999 2002 2005 2008 2011 2014
P/ENTM/ImpliedP/E
EQUITY AND BOND VALUATIONS
July 1993–September 2016
US Treasury 10 Year 1/Yield
German Bund 10 Year 1/Yield
S&P 500
Japan TOPIX
MSCI Germany
Maximum
Value 714
15
Global Equities: A Fork in the Road
As of September 30, 2016
Equity market sentiment has become increasingly divided as the bull
market has matured. This is an opportunity for the well-informed stock
picker but implies rising market risks.
China and the energy sector are experiencing major structural change,
adding to the natural bouts of volatility created by an equity market thesis
that is in transition.
Reasonable valuations, modest global profit growth, and cash-rich balance
sheets should provide support to global equities. It is important to temper
return expectations, however.
Emerging market equity fundamentals are as dispersed as ever and
selectivity is critical. Emerging market-listed stocks delivering long-term
growth should regain/retain a premium in a lower-growth world.
Political uncertainty and popular protest have become mainstream as
economic inequality is being called into question. Fiscal stimulus is one
potential outcome.
16
Important Information
This material is being furnished by T. Rowe Price for general informational purposes only. Under no circumstances should the content, in whole or in part, be copied
or redistributed without consent from T. Rowe Price. The material does not constitute a distribution, an offer, an invitation, recommendation or solicitation to sell or
buy any securities in any jurisdiction. The material has not been reviewed by any regulatory authority in any jurisdiction. The material does not constitute advice of
any nature and prospective investors are recommended to seek independent legal, financial, and tax advice before making any investment decision.
The views contained herein are as of November 2016 and may have changed since that time.
Past performance cannot guarantee future results.
Australia—Issued in Australia by T. Rowe Price International Ltd (ABN 84 104 852 191), Level 50, Governor Phillip Tower, 1 Farrer Place, Suite 50B, Sydney, NSW
2000, Australia. T. Rowe Price International Ltd is exempt from the requirement to hold an Australian financial services licence in respect of the financial services it
provides in Australia. T. Rowe Price International Ltd is authorised and regulated by the UK Financial Conduct Authority under UK laws, which differ from Australian
laws. For Wholesale Clients only.
Canada—Issued in Canada by T. Rowe Price (Canada), Inc. T. Rowe Price (Canada), Inc.’s investment management services are only available to Accredited
Investors as defined under National Instrument 45-106. T. Rowe Price (Canada), Inc. enters into written delegation agreements with affiliates to provide investment
management services.
DIFC—Issued in the Dubai International Financial Centre by T. Rowe Price International Ltd. This material is communicated on behalf of T. Rowe Price International
Ltd by its representative office which is regulated by the Dubai Financial Services Authority. For Professional Clients only.
EEA—Issued in the European Economic Area by T. Rowe Price International Ltd, 60 Queen Victoria Street, London EC4N 4TZ which is authorised and regulated by
the UK Financial Conduct Authority. For Professional Clients only.
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2017 Market Outlook - International Equity

  • 1. INTERNATIONAL EQUITY Chris Alderson Head of International Equity November 17, 2016 2017 Global Market Outlook Press Briefing
  • 2. 2 The Bull Market No One Loved *Begins on March 9, 2009, which was the low point for the S&P 500 during the financial crisis. Past performance cannot guarantee future results. Sources: FactSet, Standard & Poor’s, and MSCI. Returns in USD. +276% +146% +130% +111% 100 150 200 250 300 350 2009 2010 2011 2012 2013 2014 2015 2016 IndexLevel(100=3/9/2009) REGIONAL RETURNS March 2009*–September 2016 S&P 500 MSCI Europe MSCI Emerging Markets MSCI Japan “The Death of Equities?”
  • 3. 3 The Scarcity of Growth As of September 30, 2016 Source: FactSet. 7.1 7.0 6.7 5.1 3.1 3.0 2.5 2.0 0.6 -1.2 -2.4 2.6 1.5 1.5 1.1 0.4 -4.0 -2.0 0.0 2.0 4.0 6.0 8.0 RealGDPGrowthYoY% REAL GDP GROWTH YEAR-OVER-YEAR (%) -40 -20 0 20 40 60 80 100 120 140 2007 2008 2009 2010 2011 2012 2013 2014 2015 Emerging Markets Europe ex UK Japan United Kingdom United States REGIONAL PROFITS (EPS IN USD) In USD Since Last Cycle Peak (October 2007)
  • 4. 4 The Hope for Growth As of September 30, 2016 Sources: Ministry of Health, Labour & Welfare; Statistical Office of the European Communities; Bureau of Labor Statistics; Haver Analytics; and Morgan Stanley Research. -5 -4 -3 -2 -1 0 1 2 3 4 2004 2006 2008 2010 2012 2014 Year-Over-Year%Growth EMPLOYMENT GROWTH BY REGION Japan EU US CORPORATE EARNINGS—WHERE NEXT? Falling Rates Rising Earnings Higher Rates Rising Earnings Falling Rates Falling Earnings Higher Rates Falling Earnings MOST BULLISH MOST BEARISH ?
  • 5. 5 Growth Motoring, Markets Rotating As of September 30, 2016 Past performance cannot guarantee future results. Sources: MSCI, total return indices used for MSCI Value and MSCI Growth. Source for MSCI data: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI. 80 100 120 140 160 180 200 220 240 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 MSCI WORLD VALUE—MSCI WORLD GROWTH Total Return Indexed to 100 Value - Growth Mean -1 St Dev -2 St Dev +1 St Dev + 2 St Dev -40% -30% -20% -10% 0% 10% 20% 30% 40% TOTAL RETURN (%) Dec. 31, 2014‒Feb. 11, 2016 Feb. 16, 2016‒Sept. 30, 2016
  • 6. 6 Economic Inequality and the Protest Vote As of December 31, 2015 Sources: FactSet, Haver Analytics, Standard & Poor’s, Bureau of Economic Analysis, Federal Reserve Board, Tax Policy Center, Citizens for Tax Justice, and T. Rowe Price. *Equal-weighted total return of U.S. equities (S&P 500) and U.S. 10-year government bonds. 0% 5000% 10000% 15000% 20000% 25000% 30000% 40% 42% 44% 46% 48% 50% 52% 54% 1950 1960 1970 1980 1990 2000 2010 CumulativeReturn NAICSU.S.Wagesas%ofGDP Wages as % of GDP Equal-Wtd Equity and Bond Blend* WALL STREET BOOM, MAIN STREET BUST 1950‒2015 BREXIT
  • 7. 7 Profits—U.S. Economy Versus the S&P 500 Index Sources: Deutsche Bank Research and Haver Analytics. Service industries are: financials; multiline retail; specialty retail; Internet and catalogue retail; diversified consumer services; hotels, restaurants, and leisure; IT services; health care providers; and services. 86% 32% 14% 68% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Share of U.S. Employment Share of S&P 500 Earnings THE U.S. ECONOMY VS. THE S&P 500 INDEX As of October 31, 2015 Service Industries Manufacturing/Goods Producing Industries 65% 43% 42% 34% -10% 0% 10% 20% 30% 40% 50% 60% 70% 2008Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 2015Q4 2016Q1 2016Q2 2016Q3(E) 2016Q4(E) 2017Q1(E) 2017Q2(E) 2017Q3(E) 2017Q4(E) CumulativeGrowthinOperatingEarningsPerShare EARNINGS GROWTH BY SECTOR 2013—2017E S&P 500 Health Care and Information Technology S&P 500 Financials and Utilities S&P 500 Consumer Discretionary and Consumer Staples S&P 500 Energy, Industrials, and Materials 2013Q1
  • 8. 8 Europe’s Pain As of September 30, 2016 Past performance cannot guarantee future results. Source: FactSet. U.S. VS. EUROPEAN EQUITIES RELATIVE PRICE PERFORMANCE (USD) EUROPE AS A % OF WORLD MARKET CAPITALIZATION 20% 22% 24% 26% 28% 30% 32% 34% 36% 38% MSCI Europe Market Cap Relative to World Market Cap 40 50 60 70 80 90 100 110 120 130 1969 1972 1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014 S&P Minus Europe Mean -1 St Dev +1 St Dev
  • 9. 9 European Profits—Why so Bad? Chart is shown for illustrative purposes only and does not represent the performance of any specific security. Sources: FactSet and MSCI. -26.4% -13.4% -11.6% -6.8% -3.0% 0.4% 1.4% 1.9% 2.4% 3.3% -35% -30% -25% -20% -15% -10% -5% 0% 5% 10% MSCI EU: CONTRIBUTION TO EARNINGS CHANGE BY SECTOR October 2008 to August 2016 -5% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% Oct-08 Apr-09 Oct-09 Apr-10 Oct-10 Apr-11 Oct-11 Apr-12 Oct-12 Apr-13 Oct-13 Apr-14 Oct-14 Apr-15 Oct-15 Apr-16 MSCI EU INDEX: PERCENT OF EARNINGS FROM ENERGY, MATERIALS, AND FINANCIALS October 2008‒August 2016 Energy Materials Financials 60% 18%
  • 10. 10 0 2 4 6 8 10 12 14 16 18 20 22 Yen(Trillion) FY TOTAL SHAREHOLDER RETURNS OF ALL LISTED COMPANIES On a Common Stock Basis 1990‒2017 (Est. for 2016‒2017) Dividends Share Buybacks Japan—What Is Changing As of July 31, 2016 Past performance cannot guarantee future results. Sources: Corporate Reports, Japan Exchange Group, and Empirical Research Partners Analysis. Data exclude financials and utilities. Share buybacks are net of share issuance. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 1st Section 2nd Section Mothers JASDAQ Total JPX-Nikkei 400 JAPANESE SHARE OF STOCKS WITH INDEPENDENT DIRECTORS BY LISTING CATEGORY 2014 2015
  • 11. 11 China—A Hard Landing Within a Soft Landing As of September 30, 2016 Sources: FactSet, Haver Analytics, and China National Bureau of Statistics. 4 6 8 10 12 14 16 Year-Over-Year%Change CHINA: REAL GDP GROWTH January 2005–June 2016 51% 30% 35% 40% 45% 50% 55% Servicesas%ofGDP CHINA: SERVICES SHARE OF THE ECONOMY 1992‒2Q16
  • 12. 12 Emerging Markets—Rates Down as Inflation Abates Sources: Various National Statistical Agencies, Haver Analytics, and T. Rowe Price. 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 2010 2011 2012 2013 2014 2015 2016 Year-Over-Year%Change EMERGING MARKET INFLATION January 2010–August 2016 India Brazil China Russia 0% 02% 04% 06% 08% 10% 12% 14% 16% 18% 20% 2010 2011 2012 2013 2014 2015 2016 EMERGING MARKETS CENTRAL BANK RATES January 2010–September 2016 India Brazil China Russia
  • 13. 13 Emerging Markets: Uncertainty and Opportunity Sources: FactSet and Empirical Research Partners Analysis. Top quintile compared with sector average. VALUATIONS REFLECT CHANGE AND UNCERTAINTY 12-Month Forward P/E as of September 30, 2016 0 5 10 15 20 Mexico India Philippines U.S.A. Indonesia Malaysia The World Index Chile Europe South Africa Thailand Taiwan Japan Brazil Czech Republic Peru Greece China Qatar United Arab Emirates Colombia Poland Hungary Egypt South Korea Turkey Russia -1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 2.0 2.5 3.0 StandardDeviation EMERGING MARKETS VALUATION SPREADS The Top Quintile Compared With the Market Average January 1992‒September 2016 Valuation Spread 1 Standard Deviation -1 Standard Deviation One Standard Deviation Average NARROW DISPARITIES WIDE DISPARITIES
  • 14. 14 Multiples Have Expanded, but Extremes (or Crises) End a Cycle As of September 30, 2016 Past performance is not a reliable indicator of future performance. Sources: FactSet and MSCI. Source for MSCI data: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI. 5 7 9 11 13 15 17 19 21 23 25 27 29 Price-to-EarningsRatio DEVELOPED VS. EMERGING MARKETS 12-Month Forward P/E January 1996–September 2016 MSCI World LT AVERAGE MSCI EM LT AVERAGE MSCI World Long- Term Average 16.2x MSCI EM Long- Term Average 11.8x 0 10 20 30 40 50 60 70 80 90 100 1993 1996 1999 2002 2005 2008 2011 2014 P/ENTM/ImpliedP/E EQUITY AND BOND VALUATIONS July 1993–September 2016 US Treasury 10 Year 1/Yield German Bund 10 Year 1/Yield S&P 500 Japan TOPIX MSCI Germany Maximum Value 714
  • 15. 15 Global Equities: A Fork in the Road As of September 30, 2016 Equity market sentiment has become increasingly divided as the bull market has matured. This is an opportunity for the well-informed stock picker but implies rising market risks. China and the energy sector are experiencing major structural change, adding to the natural bouts of volatility created by an equity market thesis that is in transition. Reasonable valuations, modest global profit growth, and cash-rich balance sheets should provide support to global equities. It is important to temper return expectations, however. Emerging market equity fundamentals are as dispersed as ever and selectivity is critical. Emerging market-listed stocks delivering long-term growth should regain/retain a premium in a lower-growth world. Political uncertainty and popular protest have become mainstream as economic inequality is being called into question. Fiscal stimulus is one potential outcome.
  • 16. 16 Important Information This material is being furnished by T. Rowe Price for general informational purposes only. Under no circumstances should the content, in whole or in part, be copied or redistributed without consent from T. Rowe Price. The material does not constitute a distribution, an offer, an invitation, recommendation or solicitation to sell or buy any securities in any jurisdiction. The material has not been reviewed by any regulatory authority in any jurisdiction. The material does not constitute advice of any nature and prospective investors are recommended to seek independent legal, financial, and tax advice before making any investment decision. The views contained herein are as of November 2016 and may have changed since that time. Past performance cannot guarantee future results. Australia—Issued in Australia by T. Rowe Price International Ltd (ABN 84 104 852 191), Level 50, Governor Phillip Tower, 1 Farrer Place, Suite 50B, Sydney, NSW 2000, Australia. T. Rowe Price International Ltd is exempt from the requirement to hold an Australian financial services licence in respect of the financial services it provides in Australia. T. Rowe Price International Ltd is authorised and regulated by the UK Financial Conduct Authority under UK laws, which differ from Australian laws. For Wholesale Clients only. Canada—Issued in Canada by T. Rowe Price (Canada), Inc. T. Rowe Price (Canada), Inc.’s investment management services are only available to Accredited Investors as defined under National Instrument 45-106. T. Rowe Price (Canada), Inc. enters into written delegation agreements with affiliates to provide investment management services. DIFC—Issued in the Dubai International Financial Centre by T. Rowe Price International Ltd. This material is communicated on behalf of T. Rowe Price International Ltd by its representative office which is regulated by the Dubai Financial Services Authority. For Professional Clients only. EEA—Issued in the European Economic Area by T. Rowe Price International Ltd, 60 Queen Victoria Street, London EC4N 4TZ which is authorised and regulated by the UK Financial Conduct Authority. For Professional Clients only. Hong Kong—Issued in Hong Kong by T. Rowe Price Hong Kong Limited, 21/F, Jardine House, 1 Connaught Place, Central, Hong Kong. T. Rowe Price Hong Kong Limited is licensed and regulated by the Securities & Futures Commission. For Professional Investors only. Singapore—Issued in Singapore by T. Rowe Price Singapore Private Ltd., No. 501 Orchard Rd, #10-02 Wheelock Place, Singapore 238880. T. Rowe Price Singapore Private Ltd. is licensed and regulated by the Monetary Authority of Singapore. For Institutional and Accredited Investors only. Switzerland—Issued in Switzerland by T. Rowe Price (Switzerland) GmbH ("TRPSWISS"), Talstrasse 65, 6th Floor, 8001 Zurich, Switzerland. For Qualified Investors only. USA (public)—Issued in the USA by T. Rowe Price Associates, Inc., and by T. Rowe Price Investment Services, Inc., 100 East Pratt Street, Baltimore, MD, 21202. T. ROWE PRICE, INVEST WITH CONFIDENCE and the Bighorn Sheep design are, collectively and/or apart, trademarks or registered trademarks of T. Rowe Price Group, Inc. in the United States, European Union, and other countries. This material is intended for use only in select countries. 77283