EFTA01387247

QQQ 2.4% 0.5% IWM 1.6% 0.4% EEM 1.8% TLT 1.3% GLD 1.0% XLK 2.2% 0.1% XLF 2.3% 0.4% XLE 2.0% XLV 1.7% -0.1% XLI 2.1% 0.2% XLP 1.5% 0.3% XLY 1.9% 0.4% XLB 2.2% XLU 1.9% 03% 1st VIX Future -33% Source. DB, Bloomberg C.P. 1.6% 2.3% 42% 42.% 2.0% 0.9% 2.7% 2.2% 0.3% 2.4% -3.8% Our Macro Strategy teams are out with their midterm preview and one thing they have seen is dollar strength surrounding US elections. 100 election day 102 • 101 100 99 T -25 T 0 T 425 T 60 Dollar - A€I US CRC S 3ittag. — LrS Mkt win ssctn avelttVit T *50 Here are select notes from DB's Midterm conference call with Quinn Brody: Macro Strategist, Frank Kelly: Head of Government Affairs, and Mark Chen: Co-Head GED I lin Ili Quinn Brody: Macro Strategist • Midterm election result expectations: Base case: 60% probability is Dems take House, but not Senate o Split legislature might have focus on infrastructure, new regulations to limit drug price increases but nothing too wild o Historical experience back to 1800s shows the current president's party tends to lose seats in midterms o Dems need 24 seats take House, 2 seats to take Senate: Denis likely to take 37.44 seats in House as a function of generic ballot and the president's approval rating o Senate is trickier to predict — betting markets price odds of 88% GOP holds Senate • Markets: equities historically rally around midterm elections o Given this removal of uncertainty, we like owning equities into year-end despite recent volatility o Treasury yields historically rise when republicans retain control of both chambers and presidency Frank Kelly, Head of Government Affairs • On the polls o All over the place; seem to have gotten worse since last presidential election o What's most important to note is Dems likely to win house, but real question is by what size/margin • What's next CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0089463 CONFIDENTIAL SDNY_GM_00235647 EFTA01387247