YEAR
AHEAD
2016

CONTENTS
ECONOMICS
02

MATERIALS
45

COMMUNICATIONS07

TECHNOLOGY
50

CONSUMER
12UTILITIES
55

ENERGY
21

CREDIT
60

FINANCIALS
28

GOVERNMENT65

HEALTHCARE
35

LITIGATION70

INDUSTRIALS40

ANALYST TEAM
75

WELCOME TO
BLOOMBERGINTELLIGENCE
Welcome to the Bloomberg Intelligence 2016 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 (BI), the research division of Bloomberg L.P. Embedded in this year’s
outlook are three broad themes:
Interest rates: Toward the end of 2015, markets were betting on modest U.S. increases as
the Federal Reserve seeks to normalize interest rates. The U.K. is likely to follow by midyear.
This could mark an unusual divergence in monetary policy among the major global economies,
including Continental Europe and China, which remain focused on stimulating their economies.
C ommodities: Falling prices of metals and energy have been a boon to manufacturers andconsumers, but a bane to miners and drillers. What’s missing is a robust rebound in demand
for finished goods and sustained pricing power.
C hina: The world’s second-largest economy pushed toward 2016 with growth stabilizing at alow level, perhaps 6.5% – 7% for the coming year. Preventing a sharper slowdown will requirecontinued substantial support from policy makers, with more rate cuts and an expanded fiscal
deficit. Continued stress in real estate and exports seems likely.
BI’s global team is led by senior analysts with an average of 20 years of experience. They help
Bloomberg’s clients understand who is most likely to prosper or falter by scrutinizing thousands ofcompanies in more than 130 industries, along with major asset classes, credit metrics, economics,
government policy and current litigation. 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 ouranalysts through curated chat rooms.
We hope you’ll enjoy reading what our analysts have found. To read more BI research, go to
BI <GO> on the Bloomberg Terminal or bloomberglp.com/intelligence. For sales inquiries,
email intelligence@bloomberg.net.

Sincerely,
BLOOMBERGINTELLIGENCE TEAMDIRECTORS OFRESEARCHDAVID DWYER
GlobalDREW JONES
Global Deputy
TIM CRAIGHEAD
Asia
SAM FAZELI
Europe, Mideast & Africa
PAUL SWEENEY
North America

JULIE CHARIELL
Government
AUDE GERSPACHER
Litigation
NOEL HEBERT
CreditJOEL LEVINGTON
Credit
MIKE MCDONOUGH
Economics

CONTENT MANAGERS
PATRICIA WILSON
Global Product Manager
CHRIS ROGERS
Global Content & Editorial
VICTORIA CERULLO
Global Content CoordinatorECONOMICOUTLOOK
U.S.
FULL EMPLOYMENTA GAME CHANGER

Rising Labor Compensation Will Be a Game Changer in 2016
5Carl Riccadonna

The unemployment rate has beensurprisingly consistent in its rate of decline
over the past five years, at approximately
1 percentage point per year. If this patternpersists for a while longer, the rate is
poised to breach even the low end of theaforementioned range by mid-2016. The
economy will have definitively achieved full
employment by the middle of next year.

4

Percentage Point Spread

The U.S. economy is poised to crossseveral important milestones in the year
ahead, which are likely to improve the“feel” of the rebound from the GreatRecession. First and foremost, the labormarket will almost certainly achieve full
employment if it has not already done so.
Economists do not know the precise levelof unemployment corresponding to full
employment, but it is generally believed
to be in the vicinity of 4.75% – 5.25%.

3

2
1
0
-1
-2

1990-94

1995-99

2000-04• Labor slack (U-3 minus NAIRU) (inverted, ls)

The most direct impact from wage growth
will be to fortify consumer spending,which has underperformed for much of
the current economic cycle — particularlyin the earlier stages. Firmer householdincome growth will support a faster paceof consumption. This, in turn, will drive
Full employment will be a game changer
domestic economic activity and help tofor U.S. workers because it will result in
insulate the U.S. economy from sluggish
labor shortages extending beyond specificglobal growth.
pockets of skilled workers. This will give
employees an incentive to bargain for
Since the largest input cost for mosthigher wages, and they will be doing so
suppliers of goods and services is labor,amid the most favorable labor conditions, wage pressures will similarly help toi.e., least slack, in nearly a decade.
firm up consumer inflation by creating
Because of this, they are likely to haveupstream price pressures. In an attempt
greater success compared to recent
to minimize labor costs while optimizing
history. Job gains have been sturdy over
output, producers will make productivitythe past five years, averaging a little overenhancing capital investments, which
200k per month, but wage gains haveshould lift both the abysmal growth rate
been muted. The wage freeze is poised
in productivity as well as the pace ofto thaw as demand for workers begets
business fixed investment.
a modest labor shortage.
Finally, rising wages may entice marginal
A little wage inflation will go a long way
participants back into the labor force,to influence a number of troubling trends
thereby stemming the decline inthat have plagued the economy in recent
labor participation.
years, including tepid consumer spending,economic sensitivity to global growth
The looming presidential election will also
prospects, low inflation, weak productivity be a critical theme for the U.S. in 2016,
growth, a dearth of business investment
and the performance of the economy andand possibly even the decline in labor
financial markets will factor significantly
force participation.

2005-092010-142015-19• Average hourly earnings (non-supervisory production) (rs)into voters’ attitudes. Typically, improving
economic conditions favor the incumbent
or, in this case, the incumbent party. If thispattern holds true in the current election
cycle and economists’ projections for 2016
prove accurate, an improving economic
landscape could provide a meaningful
tailwind to the Democratic nominee.
Economic sentiment has played a crucialrole in a number of presidential contests
over the past several decades, in particular
1980, 1984, 1992, 2008 and 2012. On
some occasions, negative sentiment drovea call for change, while in other instances
voters preferred to hold the course amid
rising economic prosperity.
The current economic cycle has been
choppy and unevenly distributed — which ishardly atypical — but the emergence of evenmodest wage pressures should begin tocreate the feeling of a “rising tide” that lifts
a broader array of economic participantsin the year ahead. Furthermore, a numberof tangentially related economic woes may
be resolved in the process.

2

ECONOMICOUTLOOKEURO AREA
Euro Area’s Gradual Recovery

GRADUAL RECOVERYTO CONTINUE

3

Jamie Murray, David Powell & Maxime Sbaihi

The seismic shift in monetary policy in theeuro area in 2015, together with other
European Central Bank action, has had
some success. Sovereign borrowing
costs are much lower, and that has fed
through to the periphery. The looser policy
stance has arguably helped balance sheet
adjustment and the currency has weakened,
providing some support to net tradeagainst a gloomy backdrop for exports.
Still, the program of asset purchasesannounced in January was small comparedwith those implemented by the Federal
Reserve and the Bank of England,consistent with a more cautious approach
to policy making at the ECB.
Since the program was first implemented,
it has become clear that the degree ofmonetary stimulus would not be sufficient
to take up the abundant slack remaining in
the euro-area economy and lift underlying
inflationary pressures over a reasonable

2

1

Percent YoY

The euro area’s economic recovery has
been held back in recent years. Afterthe global financial crisis morphed intoa sovereign debt debacle, a wide marginof spare capacity opened up and has
lingered. Retrenchment by companies
and households, dented confidence andexcessively tight fiscal and monetary
policies all weighed heavily. Those forces
are fading. Credit supply is providing
an impulse to spend, austerity is mostly
over (taking the region as a whole) andmonetary policy is looser than ever. If
the external environment holds up, 2016
should see the euro area economy expand
at its fastest pace since 2010.

0

-1

-2

-3

-4

-5

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

• Real GDP year-on-yeartime frame. That, rather than the direct
influence of slowing growth in emerging
markets — which has been in train for thelast several years — is likely to be the main
motive for loosening policy further.
Thus far, the euro area’s cyclical recovery
has been led by the consumer. Declining
unemployment has lifted incomes as
people return to work and has reduced
the precautionary motive to save. At
the same time, lower commodity costs
have boosted the purchasing power ofincomes, translating into robust household
consumption.

to lower fuel costs is a one-off and thebenefits are fading fast. For the recovery
to maintain traction, firms may soon
have to do some of the heavy lifting —investment remains some 15% below
the pre-crisis peak. Confidence that therecovery has legs, together with easiercredit and cheaper equity finance, should
see investment grow faster than GDP inyears to come.

Pockets of underutilized labor persist, andfalling joblessness will continue to support
consumer spending. Though incomes
will keep growing in the euro area, theturbo-charging of spending power thanks

3

ECONOMICOUTLOOK
U.K.
Indicator of U.K. Activity Suggests Momentum to Be Maintained

WATCH PRODUCTIVITY,
BOE LIFTOFF
Dan Hanson & Jamie Murray

Having experienced a number of false
starts in the aftermath of the financial
crisis, the U.K. economic recovery finallybegan in earnest in the first half of 2013.
That coincided with a rapid fall in the rateof unemployment as firms met increasing
demand by expanding their workforces. The
economy now appears close to its supply
potential, so for the expansion to move ontoa more sustainable footing in 2016, there
will need to be a handoff from employment
gains to increases in productivity as theunderlying driver of growth.
The composition of output should remainsimilar to that seen over the recovery to date.
Private domestic demand should more thanaccount for growth in headline activity as
the external and government sectors weighin the opposite direction. The outlook forexporters remains challenging thanks to
weak external demand, while import growth
should be buoyed by a strong currency
and the high import content of domestic
demand. The year will also see significant
fiscal consolidation as the government
continues to grind toward its stated aimof a budget surplus.

2

QoQ, SAAR

The recovery in activity seen in the U.K.
since early 2013 has been enoughto leave the economy close to full
employment. To drive the expansion in
the coming year and beyond, a meaningful
revival in productivity growth will beneeded. As external disinflationary forcesdissipate, the Bank of England is likely totake the first step toward monetary policy
normalization and lift interest rates off their
0.5% floor in the first half of 2016. Further
increases in borrowing costs are likely
to be limited, with the drag from fiscal
consolidation set to weigh heavily in the
2016/17 fiscal year.

4

0

-2

-4

-6
2005

2006

2007

2008

2009

Despite those headwinds, the economy
should carry momentum from the final
quarter of 2015 into 2016, growing
at above-trend rates as the last of theremaining slack is absorbed. As that
happens, wage growth looks set tocontinue its ascent toward pre-crisis
levels, which, with only a moderate pickup
in productivity, should see to it that U.K.
inflation begins to reflect rising domestic
cost pressures rather than external
disinflationary shocks.

2010

2011

2012

2013

2014

2015

rate increases are likely to be limited
and gradual, keeping the stance ofmonetary policy extremely loose forthe foreseeable future.

Evidence that the rapid fall in theunemployment rate is finally generating
enough inflation to present a risk to
the BOE’s 2% inflation target should
persuade a majority of Monetary Policy
Committee members to vote for aninterest rate rise. If the economy evolves
in line with BI Economics’ central
expectation, that is likely to happen in
the first half of 2016. With headwinds
coming from fiscal consolidation andprivate-sector indebtedness, subsequent

4

ECONOMICOUTLOOKCHINA
FASTER STIMULUS TO KEEPGROWTH IN PLACE

Growth Has Bottomed Out

Tom Orlik & Fielding Chen

China’s growth appears to have bottomed
out. Bloomberg Intelligence Economics’
monthly GDP tracker shows the economy
expanded 6.6% year on year in October— a level it has hovered around since July.
Continued stress in real estate, wherea rebound in sales has yet to trigger arecovery in construction, weighs on theoutlook. So, too, does persistent weakness
in exports. Overseas sales contracted for
four straight months through October.

1412Percent YoY

China pushes toward 2016 with growthstabilizing at a low level. Continued
contraction in new real estate investment
and exports means risks are tilted to thedownside. Growth may come in between
6.5% – 7% in the coming year, afteran expected 6.9% outcome in 2015.
Preventing a sharper slowdown will
require continued substantial support frompolicy makers, with more rate cuts andan expanded fiscal deficit. The outlook on
the yuan is balanced between stability anddepreciation, with the latter more likely.

10

8

6

2006

2007

2008

2009

2010

• Bloomberg Monthly Growth Tracker YoY

2011

2012

• GDP YoY		

2013

2014

2015

• GDP Target

suggest it will maintain an uneasy stability.
The consensus forecast is for the currency
to end 2016 at 6.6 yuan per U.S. dollar,
down from 6.41 in early December 2015.
A larger drop to about 7 would restore
export competitiveness.

Concerns about financial stability are
well-founded and will continue to grow.
Outstanding credit rose to 208% of GDP
in September 2015 from 125% at theend of 2008. In 2016, it will continue torise. With almost all of banks’ assets andliabilities domestic, much of the action
Stabilization in growth reflects substantial
China’s government has accepted a lower taking place within the state family andpolicy support. The central bank has cut
low central government debt, theinterest rates six times in the last year. Fiscal threshold of a 6.5% annual expansion
chances of an imminent crisis are limited.
spending is accelerating. Local governments in GDP in the 13th Five-Year Plan. Thatare benefiting from a 3.2 trillion yuan ($502 doesn’t mean they’ll immediately lower the Corruption investigations targeting
annual target. Sticking with 7% for 2016
the financial sector may cause larger
billion) debt swap, helping them refinancewould signal confidence in China’s growth disturbances than deleveraging.
borrowing at lower costs. Further support
prospects and allow for lower growthon all of those fronts will be required in
toward 2020. A 7% target could widen
2016. With stressed corporate balance
the credibility gap, with market participants
sheets limiting the effectiveness of rate
becoming skeptical of China’s official data.
cuts, fiscal policy will have to do more of
the work.
The reform program will roll on. In the
The arguments on the yuan are finely
balanced. Contracting exports, capitaloutflows and a coming first rate hike fromthe U.S. Federal Reserve all suggest
the currency should fall. Fear of capitalflight and expected inflows on the backof inclusion in the International Monetary
Fund’s Special Drawing Rights basket

financial sector, interest rate liberalization
has been completed. Progress on capital
account opening may accelerate, given
a commitment to yuan convertibility by
2020. The 2015 equity market collapse
could catalyze a rethink of financial
regulation. Implementation may bringclarity to the government’s hazy plan forreform of state-owned enterprises.

5ECONOMICOUTLOOKJAPANPOLITICS, ECONOMICS POINT
TO MORE STIMULUS

Real Potential GDP Growth YoY
6

Yuki Masujima

Japan’s economy slid into a technicalrecession in the third quarter of 2015,
with GDP contracting at a 0.8%
annualized rate. A drop in inventories
weighed on growth, but is a positive for
future production. Weakness in capitalspending is more worrying. The outlook for2016 is positive, reflecting expectationsof fiscal and monetary policy support.
A moderate U.S. recovery should offset
weak Asian demand. A consumption tax
hike slated for April 2017 could drag somespending forward to the end of 2016. The
consensus forecast for GDP growth in2016 is 1.1%, up from an expected
0.6% in 2015.
Headline inflation — at zero in September
2015 — is set to rise moderately into early2016 as the impact of low oil prices fades.
That will still leave CPI some way fromthe Bank of Japan’s 2% target, setting
the scene for more easing. The most
likely scenario is expansion of stimulus
from the current 80 trillion yen in annual

54Percent YoY

Japan heads toward 2016 with theeconomy again in recession and inflation
at zero. Labor market dynamics remain
positive, with low unemployment expected
to drive rising wages. Political andeconomic logic both point to expanded
stimulus at the start of 2016, ahead ofa national election. That could provide
a short-term boost at the expense of
longer-term costs. Prime Minister
Shinzo Abe is targeting a 600 trillion
yen ($4.9 trillion) economy by 2020,
up from 500 trillion yen in 2014 —requiring nominal growth of 3% a year.

3

2

1

0
1970-74

1975-79

1980-84

1985-89bond purchases to 100 trillion yen in early2016. That could be accompanied by fiscal
stimulus of 3 trillion yen or more. A national
election in summer 2016 means there isa political as well as economic case foraction. A flexible time horizon for hitting
2% inflation could be an alternative toexpanded stimulus.
Divergence between major central banks
will mean a bumpy ride for the yen. A firstrate hike from the Fed will be a force foryen weakness. After that, the focus willswitch to the Fed’s tightening schedule— expected to be gradual. There are tailrisks on either side. The yen could drop
significantly if diverging BOJ and Fed
policies coincide with crystallization ofconcerns over Japan’s debt burden. A
delay to Fed liftoff or demand for safe
assets in the face of terrorism could
be forces for yen strength.

1990-94

1995-99

2000-04

2005-092010-2014

A potential growth rate of 0.5% means
Japan is always on the edge of recession.
Solving that problem means structuralreforms to raise labor force participation
and revive investment. Despite record
profits, corporate investment is low. A
cut in the corporate tax rate is intended
to address that problem. The tax cut isa positive for 2016 growth. To restore
investment incentives, the government will
also have to eliminate allowances that permit
firms to hoard profits. Even with far-reachingreforms, a drag from an aging populationand needed fiscal consolidation will makeAbe’s 600 trillion yen GDP target toughto achieve.

6

COMMUNICATIONSCOMMUNICATIONS
Global Ads Get Quadrennial Aid as Mobile Set to Surpass Desktop

Facebook, Google to Dominate Surging Mobile Ads as Desktop Wanes

COMMUNICATIONS 8

COMMUNICATIONS
Presidential Race in 2016 Could Be the Social Media Election

CBS Snags $1 Billion as Industry Retransmission Tops $7 Billion

COMMUNICATIONS 9COMMUNICATIONSCommunications Act, Fees, Joint Sales, Spectrum Top Tech Issues

Bundled Services May Help to Reduce Churn and Stabilize Revenue

COMMUNICATIONS 10

COMMUNICATIONS
Weak Carrier Demand May Temper Spectrum Auction Expectations

China E-Commerce Growth Stays Strong as Alibaba, JD.com Expand

COMMUNICATIONS 11

CONSUMERCONSUMER
Sugar May Become the New Pariah, But Production Isn’t Falling

Aging Chinese, Japanese Boost Sales of Health, Wellness Foods

FINANCIALS 13

CONSUMER
FDA Places Sugary Foods and Beverages in Spotlight in 2016

Growth in Natural, Organic Sales to Escalate Grocery Competition

CONSUMER 14

CONSUMER
Mass Merchants Maneuver for Millennials With Shift to Wellness

Food Retail’s Cool-Chain Brings Modern Touch to Safety, Waste

CONSUMER 15

CONSUMER
Beauty, Personal Care Embrace Health Benefits to Boost Growth

Tobacco Focus on E-Cigarette Legislation, Flavor Bans in 2016

CONSUMER 16

CONSUMER
E-Commerce Penetration Continues to Increase Amid Channel Shift

Retailers Embrace Technology to Expand Sales, Speed Fulfillment

CONSUMER 17

CONSUMER
The Lure of Now: E-Tailers Chase Shoppers With Instant Delivery

Luxury Goods Must Balance Tradition With Technology for Success

CONSUMER 18

CONSUMER
Retail Earnings May Rise as Online Shopping Boosts Offline Sales

Macau Casino Success to Align With Haves, Have-Nots on Cotai

CONSUMER 19

CONSUMER
Restaurants Dish Up Tech Spending in Pursuit of Loyal Customers

Autos Go Electric, Get Turbocharged to Meet Emissions Targets

CONSUMER 20

ENERGY

ENERGY
Oil Balance May Tighten, Prices May Be Capped and M&A in Play

Iran Post-Ban Oil Output Rebound Doubts Unfounded, Expert Says

ENERGY 22

ENERGY
China Manufacturing Shift Means Slower Growth in Demand for Oil

Australia to Become World’s Biggest LNG-Exporting Nation by 2018

ENERGY 23

ENERGY
Perfect Storm of M&A Drivers Brewing for European E&P in 2016

Apache Is One of the Largest Operators in the Permian Basin

ENERGY 24

ENERGY
Rising IDRs Don’t Mix With Energy Market Tumult

Integrateds, Not Large E&Ps, Only Ones Likely Able to Buy Apache

ENERGY 25

ENERGY
Oil Servicers’ 2016 Outlook Grim as World Needs U.S. Supply Drop

High-Yield Energy Debt at Largest Discount to Market in 10 Years

ENERGY 26

ENERGY
Election Year Likely Pushes U.S. Crude Oil Export Debate to 2017

Petrobras Investor Challenges Are Consolidated for Trial in 2H16

ENERGY 27

FINANCIALSFINANCIALS
Global Financials at Mercy of Forex, Macro, Rates

Regulation Continues to Shape 2016 Financials Strategies, Profit

FINANCIALS 29

FINANCIALS
EU Banks 2016 Plans Hinge on ECB, $8.4 Trillion IFRS9 Challenge

More FICC Cuts May Help Bank Returns, Add to Liquidity Concerns

FINANCIALS 30

FINANCIALS
China to Remain Barometer, Driver for Global Credit and Bad Debt

Asia Insurers Look West as Western Banks Seek Growth Opportunity

FINANCIALS 31

FINANCIALS
EU Banks’ $375 Billion Costs Are Key to 2016; Margins to Narrow

Global Insurance Margins at Risk in 2016 After 2015 Price Drop

FINANCIALS 32

FINANCIALS
U.S.-European Policy Divergence Brings Insurers Mixed Fortunes

U.S. Regional Banks Seek Loan Growth and Gains From Higher Rates

FINANCIALS 33

FINANCIALS
JPMorgan, RBS Epitomize Scale of Cyber Threats, Opportunities

Mobile Payments, Alternative Lending Ready to Lift Off in 2016

FINANCIALS 34

HEALTHCARE

HEALTHCARE
Drugmakers Brace for Onslaught of Pricing Noise in Campaign

J&J, Pfizer, Gilead May Star in 2016 M&A; Valeant Off the SceneHEALTHCARE 36

HEALTHCARE
Stage Set for Biotech IPOs in 2016, Needs Revival in Optimism

Cancer Immunotherapy Combinations May Take Giant Leap in 2016

HEALTHCARE 37

HEALTHCARE
Sequencing Cost Declines to Spur Innovation in 2016 and Beyond

Large Pharmacy Deals to Change Supply-Chain Landscape in 2016

HEALTHCARE 38

HEALTHCARE
Weakening Exchange Enrollment May Hurt Hospital, Insurer Margins

Boston Scientific, Edwards Have Biggest Device Catalysts in 2016

HEALTHCARE 39

INDUSTRIALSINDUSTRIALSMining, Energy Pressure May Prompt Further Spending Cuts in 2016

Global Industrial Deal-Making May Gain Momentum in 2016

INDUSTRIALS 41

INDUSTRIALS
Europe May Prove Industrials Economic Bright SpotSoutheast Asia Welcomes Low-Value Goods Producers from China

INDUSTRIALS 42

INDUSTRIALS
Aircraft Makers Ponder Production Plans and Asia Growth in 2016

Pentagon Replaces Navy, Air Force ‘Big Iron’ in 2016; Eyes Cost

INDUSTRIALS 43

INDUSTRIALS
Slack Capacity, Chinese Demand May Cause Rough Seas for Shipping

Railroads, Trucking Companies Should Overcome Tepid 2016 Demand

INDUSTRIALS 44

MATERIALSMATERIALS
China Aluminum Industry’s Supply Glut May Linger on New Capacity

Carry Trade Distorts China Copper Demand, Leads to Oversupply

MATERIALS 46

MATERIALSSpecialty Chemicals 2016 Margins May Be Pressured by Oil, Dollar

Cropocalypse Now? AgChems in Glut as Incomes Fall

MATERIALS 47

MATERIALS
Rising African Demand Drives Expanded Cement Capacity Investment

M&A and Mature Markets Boost Cement Outlook; Brazil, China Drag

MATERIALS 48

MATERIALS
U.S. Lumber’s Longer-Term Positives Eclipsed by Near-Term Issues

Cyclical Rise in Wood Products Beats Secular Decline in Paper

MATERIALS 49

TECHNOLOGYTECHNOLOGY
Amazon, Microsoft Likely Retain Infrastructure-as-a-Service Lead

Varying Cloud Models Pose Risk, Opportunity for HP, Dell and IBM

TECHNOLOGY 51

TECHNOLOGY
Rising Demand for Security Software May Drive More M&A in 2016

Diverse Motivations Drive Semiconductor Industry Consolidation

TECHNOLOGY 52

TECHNOLOGY
China May Use M&A, Regulatory Scrutiny to Gain Chip PowerNew Samsung Integrated Chip Threatens Qualcomm’s Comeback PlanTECHNOLOGY 53

TECHNOLOGY
China Smartphone Market Drop-Off Signals Industry Maturation

Timely Windows 10 Brings Potential for Outsized PC Influence

TECHNOLOGY 54

UTILITIESUTILITIESBig Utilities Seek Growth in M&A, Solar, Wires as Sales Slow

Emerging Market Slump May Reshape Cross-Border M&A by Utilities

UTILITIES 56

UTILITIESNatural Gas to Stage Comeback in 2016 on Lower Prices, Closures

Low Gas, Power Prices Hurt Merchant Generators, Help Regulated

UTILITIES 57

UTILITIES
Utility M&A Looks to Divest Merchant Units, Buy Regulated Assets

Solar Energy Demand Expected to Build in 2016 on Policy Drivers

UTILITIES 58

UTILITIESPower Industry Changes May Come From High Court

Utilities Propose Pipelines to Fuel Power Plants, Add Customers

UTILITIES 59

CREDIT

CREDIT
Global Corporate Borrowers Tap Into Monetary Policy Divergence

Corporate-Bond Issuance May Decline on Higher Interest Rates

CREDIT 61

CREDITBig Issues Mark 2016 Junk Maturities, High-Grade Cadence SteadyHigher Rates May Reverse Bond ETF Inflows Nearing $80 Billion

CREDIT 62

CREDIT
Ratings Deteriorate on Releveraging Trends, Commodity Pressures

Signs Debt Leverage Is Rising Abound in Global Corporate Credit

CREDIT 63

CREDIT
Outlook for 2016 Distressed Ratios May Rely on Economic HealthDefaults Are Less Likely in High-Yield Technology, Consumer Debt

CREDIT 64

GOVERNMENTGOVERNMENTElection Season Sets Stage for Next Four Years

U.S. Banks Can Expect Cost of Derivative and Swap Trades to Jump

GOVERNMENT 66

GOVERNMENT
Pacific Trade Deal Passage Will Be Obama’s Last Herculean Task

U.S. Wind and Solar Power Incentive Program to Take Form in 2016

GOVERNMENT 67

GOVERNMENT
Obamacare Repeal and Drug Pricing Among Campaign Themes to Watch

U.S. Bank Regulators to Complete Systemic Risk Framework in 2016

GOVERNMENT 68

GOVERNMENT
Consumer Staples Industry May Feel Regulatory Fallout in 2016

Communications Act, Fees, Joint Sales, Spectrum Top Tech Issues

GOVERNMENT 69

LITIGATIONLITIGATION
Fairholme’s Fannie, Freddie Suit Moving Toward Ruling in 2Q16

DuPont, Chemours PFOA Litigation Heads to Second Trial in March

LITIGATION 71

LITIGATION
Health Insurer M&A Antitrust Fate Will Likely Be Sealed in 2H16

FCC Well Positioned in Net Neutrality Case Set for 2016 Decision

LITIGATION 72

LITIGATION
Cisco-Arista Dispute Comes to a Head in 2016 After Key Trials

Court Quarrel Over Obama’s Clean Power Plan Could Come in 2016

LITIGATION 73

LITIGATION
Caesars Bankruptcy Examiner’s Report Likely Catalyzes Case in 1Q

Bass-Granted Drug Patent Challenges Will Be Decided in Late 2016

LITIGATION 74

BLOOMBERGANALYSTS &ECONOMISTSRESEARCH
MANAGEMENTDavid Dwyer
Research Director
GlobalDrew Jones
Deputy Research Director
GlobalPatricia Wilson
Product Manager
GlobalChris Rogers
Content Manager & Editorial
GlobalVictoria CerulloContent Coordinator
GlobalGalen Meyer
Executive Editor
Rick GreenManaging Editor
Frank Longid
Managing Editor
COMMUNICATIONSPaul Sweeney
North American Research Director
Media
North America
John Butler
Telecom & Networking
North America
Erhan Gurses
Telecom & MediaEMEA
Geetha Ranganathan
Media
North America
Tal Smoller
Telecom & MediaEMEAAlex Wisch
Telecom & MediaEMEA
Joshua Yatskowitz
Telecom & Media
North America
CONSUMER
Timothy Craighead
Asian Research Director
Gaming & Lodging
APAC

Deborah Aitken
Luxury, Household& Personal Care
EMEA

Joel Levington
Credit Research Director
Industrials
North America

Charles Allen
Retail, Food & Electronics
EMEA

Dragos Ailoae
Index
North America

Jennifer Bartashus
Food & Restaurants
North America

Richard Bourke
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75

BLOOMBERGANALYSTS &ECONOMISTS
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76

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