Asian mkts to take lead from US mkts: Kirk West

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Kirk West, MD-Investment Strategy (Asia) at Principal Global Investors believes that Asian markets will take lead from the US markets on a daily basis.

He expects volatility to continue as the US seems to be concerned over growth.

Here is a verbatim transcript of the interview with Kirk West on CNBC TV-18. Also see the accompanying video.

Q: There is volatility seen in Asia- do we see deep in the red or medium in the red for Asia today?

A: I think Asia on a daily basis will take its lead from the US and the US continues to be concerned over growth. So I think we can expect some red today and we continue to expect volatility as we keep looking at the growth numbers.

Q: There are some looming signs of recession through out the world now, growth has definitely slowdown- what are certain sectoral themes that you would look at currently that would sort of weather this slowdown?

A: Most of the major economies now expect to have a significant slowdown going into the first half of next year in particularly. We have looked at sectors such as healthcare, telecom, in some cases utility which are always good defensive stocks. But those stocks have performed well and it is worth noting that we are now starting to see some very compelling valuations across all sectors.

We are probably at the part of the cycle where it ought to be a diversified portfolio because there are opportunities in each of the underlying sectors.

Q: Considering specific markets what is your pick? Considering Japanese economy the figures are indicating that it is likely to ground to a halt in the third quarter- what is your sense of Nikkei? What is your sense of China where retails have jumped 22% indicating consumer spending is still on?

A: We still remain relatively constructive of Asia as a whole and what you are going to see maybe looking at China is that stimulus package which was announced at the weekend; once we get a clearer idea of how that is going to be executed and the time when we actually start to see it executed, I think that is going to provide some good support and good opportunities.