Wells Fargo Investment Institute Midyear Outlook

Fargo Investment Institute today released its 2018 midyear outlook
report, “Late
Cycle Doesn’t Mean End of Cycle.” The report makes the case that the
economic recovery, which coincides with the equity bull market, has more
room to run.

View the digital presentation of the Wells Fargo Investment Institute
2018 Midyear Outlook, “Late
Cycle Doesn’t Mean End of Cycle.”

The report details where the institute says bond investors should be
positioned on the yield curve as the Federal Reserve hikes rates. It
also describes near-term opportunities in U.S. equities and suggests
that the environment is becoming more favorable for select alternative
investment strategies.

“The first half of the year certainly delivered on our outlook’s
anticipated market volatility, but there are a variety of indicators
that convince us the bull market could run for another year or longer.
Investors need to remain diligent to higher interest rates and growing
trade tensions,” said Darrell Cronk, president of Wells Fargo Investment
Institute and chief investment officer of Wealth and Investment
Management at Wells Fargo.

The report also outlines three strategies for investors to consider.
They include:

“We expect strong economic growth to support earnings and to guide the
equity market higher through at least the first quarter of 2019, and
possibly longer,” said Paul Christopher, head of global market
strategy for the Wells Fargo Investment Institute. “Yet we expect
volatility to continue through the end of 2018 and continue to closely
watch for geopolitical events, Fed policy and global economic surprises.”

About Wells Fargo

Wells Fargo & Company (NYSE: WFC) is a diversified, community-based
financial services company with $1.9 trillion in assets. Wells Fargo’s
vision is to satisfy our customers’ financial needs and help them
succeed financially. Founded in 1852 and headquartered in San Francisco,
Wells Fargo provides banking, investments, mortgage, and consumer and
commercial finance through 8,200 locations, 13,000 ATMs, the internet
(wellsfargo.com) and mobile banking, and has offices in 42 countries and
territories to support customers who conduct business in the global
economy. With approximately 265,000 team members, Wells Fargo serves one
in three households in the United States. Wells Fargo & Company was
ranked No. 25 on Fortune’s 2017 rankings of America’s largest
corporations. News, insights and perspectives from Wells Fargo are also
available at Wells
Fargo Stories.

About Wells Fargo Investment Institute

Fargo Investment Institute (WFII) is a registered investment adviser
and wholly owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate
of Wells Fargo & Company, providing investment research, strategy,
manager research and thought leadership within the Wealth and Investment
Management division (WIM), with the goal of supplying world class advice
to the company’s financial and wealth advisers.

Risk Factors

Forecasts are not guaranteed and are subject to change.

Diversification does not guarantee profit or protect against loss in
declining markets.

All investing involves risks including the possible loss of principal.
Equity securities are subject to market risk which means their value may
fluctuate in response to general economic and market conditions and the
perception of individual issuers. Investments in equity securities are
generally more volatile than other types of securities.

Investments in fixed-income securities are subject to market, interest
rate, credit/default, liquidity, inflation and other risks. Bond prices
fluctuate inversely to changes in interest rates. Therefore, a general
rise in interest rates can result in the decline in the bond’s price.
Credit risk is the risk that an issuer will default on payments of
interest and principal. This risk is higher when investing in high yield
bonds, also known as junk bonds, which have lower ratings and are
subject to greater volatility. If sold prior to maturity, fixed income
securities are subject to market risk. All fixed income investments may
be worth less than their original cost upon redemption or maturity.

Investing in foreign securities presents certain risks not associated
with domestic investments, such as currency fluctuation, political and
economic instability, and different accounting standards. This may
result in greater share price volatility. These risks are heightened in
emerging markets.

Alternative investments carry specific investor qualifications, which
can include high income and net-worth requirements as well as relatively
high investment minimums. They are complex investment vehicles that
generally have high costs and substantial risks. The high expenses often
associated with these investments must be offset by trading profits and
other income. They tend to be more volatile than other types of
investments and present an increased risk of investment loss. There may
also be a lack of transparency as to the underlying assets. Other risks
may apply, as well, depending on the specific investment product.

Wells Fargo Investment Institute, Inc. (“WFII”), is a registered
investment adviser and wholly-owned subsidiary of Wells Fargo & Company
and provides investment advice to Wells Fargo Bank, N.A., Wells Fargo
Advisors, and other Wells Fargo affiliates. Wells Fargo Bank, N.A., is a
bank affiliate of Wells Fargo & Company.

The information in this report was prepared by WFII. Opinions represent
WFII’s opinion as of the date of this report and are for general
information purposes only and are not intended to predict or guarantee
the future performance of any individual security, market sector, or the
markets generally. WFII does not undertake to advise you of any change
in its opinions or the information contained in this report. Wells Fargo
& Company affiliates may issue reports or have opinions that are
inconsistent with, and reach different conclusions from, this report.

The information contained herein constitutes general information and is
not directed to, designed for, or individually tailored to, any
particular investor or potential investor. This report is not intended
to be a client-specific suitability analysis or recommendation, an offer
to participate in any investment, or a recommendation to buy, hold or
sell securities. Do not use this report as the sole basis for investment
decisions. Do not select an asset class or investment product based on
performance alone. Consider all relevant information, including your
existing portfolio, investment objectives, risk tolerance, liquidity
needs and investment time horizon.

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