European Software, IT services & Payments: Q2 Playbook: more proof points on AI

Research evidence excerpt

European Software, IT services & Payments: Q2 Playbook: more proof points on AI

Exhibit 21: European autos is the most underweight and undervalued Exhibit 22: Positioning for healthcare and energy have improved the

sector, according to European survey respondents, while technology is most from last month, while positioning for consumer products,

the most overweight and overvalued sector chemicals and utilities have fallen the most

European sectors net valuation versus net positioning Month-on-month changes in FMS sector positioning and valuation

Overvalued and Positioning Valuation

Healthcare 44 -7 70 Technology Overweight Energy 17 -12

60 Ind. Gds&Svs 8 6

50 Real Estate 7 15

Media 6 2

=> Pers Care Drg&Grc St 3 -4

30 Ind. Gds&Svs Banks 2 -10

Insurance Travel&Leis. 1 1

Telecoms -1 7 overvalued Utilities

/ 10 Telecoms Technology -4 19

Financial Svs Basic Res. -5 -4 0 Pers Care

Retail Financial Svs -6 7 Real Estate Basic Res. Banks -10 Food Bev&Tobacco -7 -12 Construction undervalued

<= -20 Media Chemicals Retail -7 12

Food Bev&Tobacco Travel & Leisure Energy Autos -8 3

-30 Insurance -10 8

Healthcare

-40 Consumer Pds&Svs Construction -11 -1 Autos

Utilities -12 4

-50

-50 -40 -30 -20 -10 0 10 20 30 40 50 Chemicals -12 4

Undervalued and <= underweight / overweight => Consumer Pds&Svs -16 -6

Underweight Source: LSEG Datastream Source: BofA European Fund Manager Survey

BofA GLOBAL RESEARCH

Source: BofA European Fund Manager Survey

Exhibit 23: European healthcare and utilities are the most over-owned sectors relative to history,

while media and personal care are the most under-owned

Current European sectors positioning relative to history (z-scores)

Healthcare/Pharma

Utilities

Banks

Basic Resources

Financial Svs

Industrial Gds&Svs

Technology

Energy

Construction

Real Estate