The China Files
The Logistics Journey is Just Beginning
April 24, 2012

China may grow to be the world’s third-largest third-party logistics market by 2016. In this next installment of The China Files series, we identify several factors that will support this growth in China’s 3PL market and discuss how specific trends in the industry bode well for certain logistics-related stocks.

Wholesale & Investment Banking Outlook
Decision Time for Wholesale Banks
March 23, 2012

The market appears to underestimate imminent changes in banking industry structure as banks rationalize their portfolios and market shares shift. Wholesale banks could return to 12-14% ROE in the next two years following this rationalization. We see an increased de-globalization of banks and markets, reinforcing home market advantages as many firms shift to a more domestic focus.

Solvency 2
The Long and Winding Road
March 23, 2012

In this follow-up to last year’s Blue Paper on the same topic, we propose that Solvency 2 is still a force for beneficial change in the insurance industry, but the road to implementation has been longer and more circuitous than originally hoped. Still, we remain confident that the final Solvency 2 framework will permit a mechanism to offset the impact of credit spread widening on capital, and peg strong, well-diversified reinsurers as likely beneficiaries.

Banks Deleveraging and Real Estate
Implications of a €400-700bn Financing Gap
March 15, 2012

Commercial real estate faces a financing gap of €400-700bn, mainly from banks deleveraging. We believe that banks with more exposure to CRE face greater risk and that quoted stocks in the property sector should do relatively better. Private equity has clear opportunities to pick up business from banks.

The China Files
China's Appetite for Protein Turns Global
October 25, 2011

In our most recent China Files report, we look at how China's growing demand for protein foods affects the global economy. Our analysts posit that constraints on local production will force China, already the world's largest importer of soybeans, to boost imports of soft commodities from the US and Latin America.

The US Healthcare Formula
Cost Control and True Innovation
June 16, 2011

Legislative and secular challenges are forcing a sea change in the US healthcare sector. Whether or not US healthcare reform is implemented as proposed, changes to the US healthcare system over the next three to five years will be sweeping—and the investment implications broad. We identify the stocks that are positioned for long-term gain.

Cloud Computing Takes Off
Market Set to Boom as Migration Accelerates 
May 23, 2011

Use of the public cloud could increase twice as fast as the market anticipates—up to a 50% CAGR in the next three years. Our AlphaWise evidence is based on the first cloud migration survey of IT managers across the US, Europe and Asia-Pacific: those using the cloud are expected to rise from 28% to 51% in three years, and the portion of their workload running in the cloud may more than double. Seventeen analysts from seven industries discuss how the shift away from on-premises hardware will affect the IT universe and identify eight companies positioned to capture the cloud.

China High-Speed Rail
On the Economic Fast Track
May 16, 2011

The Blue Paper delves into the macroeconomic and investment implications of the biggest transportation infrastructure project in history—the rapid expansion of China’s high-speed rail system. Through the expansion of this rail line, large sections of China’s population are becoming more mobile, remote regions of the country are opening up, and Chinese businesses are racing to meet under-served consumer demand. Our China strategists see this infrastructure project as the key to sustaining China’s double-digit growth.  

Asia Inflation
Consumers Adjust as Inflation Worsens
March 31, 2011

We see greater risk ahead in Asia's inflation outlook: In this Blue Paper we point to a greater possibility of acceleration to our upside risk scenario of 5.7% inflation in summer 2011. Our AlphaWise results concur: 71% of consumers surveyed in six Asian countries expressed concern over rising inflation. This paper explores the implications for p/e multiples and earnings assumptions and discusses the implications for two baskets of Asian stocks.

Wholesale & Investment Banking Outlook
Reshaping the Model
March 23, 2011

The market underestimates banks' potential to reach RoEs in the mid-teens. To do so, bank management must act decisively to reshape their firms' business models. Yet despite the challenge of new regulations, this Blue Paper finds that three-quarters of banks' revenues are already fit for the new environment. The paper discusses how banks will have to reprice their services, gain scale and cut costs—and which of their institutional clients stand to lose or gain.

Global Gas
A Decade of Two Halves
March 14, 2011

A significant oversupply of liquid natural gas will persist for several years while China boosts local production to satisfy its own gas needs, according to our global gas analysts. But after 2015 supplies will tighten fast.

This Blue Paper draws on the perspectives of analysts from across the firm who cover energy, petrochemicals, renewable energy and utilities. Their thesis goes against consensus expectations for tightening in the markets. In particular they point to regional dynamics and specific investment opportunities along six major themes.  

Tablet Demand and Disruption
Mobile Users Come of Age
February 14, 2011

With the first-ever global tablet survey of more than 8,000 consumers and 50 chief information officers, Morgan Stanley's Global Technology, Media and Telecommunications Equipment team explores demand and disruptions caused by consumers' adoption of tablet computers. This new Blue Paper indicates that similar to the demand for smartphones over the past few years, demand for tablets is likely to surprise to the upside with the possibility of shipments reaching 100 million by 2012.

The China Files
Chinese Economy through 2020
November 8, 2010

To set the stage for the three regional China Files reports on corporates most likely to do well, we delved deeply into the macroeconomic factors behind the trends driving China's megatransition. The main topics in these reports are China's growth outlook and the structural evolution of the economy, China's demographic and labor market trends and the rise of the Chinese consumer.¹

The China Files
Asian Corporates & China's Megatransition
November 8, 2010

In the third report in the China Files series, we analyze the influence that China’s macroeconomic “megatrends” may have on Asian multinationals and highlight the Asian companies likely to benefit from these trends.

The China Files
European Corporates & China's Megatransition
October 29, 2010

In the second report in the China Files series, our global analysts describe how the macroeconomic “megatrends” in China will affect European multinationals in China. The team takes stock of which European companies are likely to do well in this changing macro environment and why.

Petrochemicals
Preparing for a Supercyle
October 18, 2010

Morgan Stanley chemicals analysts from around the world discuss what surging emerging market demand means for the global petrochemicals industry.¹

Solvency 2: Quantitative & Strategic Impact
The Tide is Going Out
September 22, 2010

Morgan Stanley's European insurance analysts assess the potential impact of Solvency 2 as a catalyst for a fundamental reappraisal of traditional insurance business models. ¹

The China Files
US Corporates and China's Megatransition
September 20, 2010

The debut report in our China Files series explores what China's economic transformation means for the global economy and for multinational corporations doing business in China today and over the next 10 years. We describe the "megatrends" that are hastening China's "megatransition" from the world's biggest producer of manufactured goods to its biggest consumer.

In this report our industry analysts from the Asia-Pacific region, Europe, and the US team up with their colleagues from China to identify the criteria required for US multinationals to succeed in China. Together they name the global players that have the best current positioning, strategy, and competitive edge.¹

Brazil Infrastructure
Paving the Way
May 5, 2010

Our Latin American team of economists, strategists, and equity analysts examines macroeconomic scenarios connected to infrastructure investment and identifies companies best positioned to take advantage of the opportunities and challenges that investors face as Brazil continues to develop its infrastructure. ¹ A macroeconomic analysis offers alternative scenarios for long-term GDP growth based on the level of infrastructure investment, and a team of industry analysts pinpoints the companies that are likely to benefit.

Morgan Stanley chemicals analysts from around the world discuss what surging emerging market demand means for the global petrochemicals industry.¹

Footnotes
¹Morgan Stanley clients receive stock-specific information related to this report upon its delivery. Additional information on recommended securities/instruments is available upon request. Please contact a Morgan Stanley advisor.

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