Small probability of mkts testing Mar lows: Credit Suisse

Here is a verbatim transcript of the exclusive interview with Robert Parker on CNBC-TV18. Also watch the accompanying video.

Q: What exactly do you think has been the catalyst for the sharp sell off on global markets today?
A: There are three factors. First let's not forget that we had a very strong market over the last two weeks for example last week we had the S&P up over 6% and then in Europe most markets were up close to 2%, so first is that there was as an element of profit taking going on. The second element is we have had the Chief Executives of General Motors in the US and Chrysler- here in Europe both being replaced and there is genuine concern which is not new, that we may finally have to see General Motors and Chrysler go into Chapter 11 Administration or a variant of that.

The third factor is the statements from treasury secretary Geithner saying and he wasn't actually detailed in the statement but suggesting that further large amounts of support will be required fro the American Banking system. So that has resulted in a sell off essentially focused on the auto sector and on the banking sector.

Q: There was also comment from Bank of America over the weekend suggesting that while January and February were profitable for US banks, March was not such a good month - do you think the financial sector might have taken some negative tones out of that?

A: I think possibly. Now one question is to what extent banks such as Bank of America are going to be taking write downs during March for their quarter end. We will get the bank and other company results for the first to be announced in late April and Early May. And the general observation is that corporate results are probably not going to see a significant turn around for the first quarter. I suspect any corporate earnings turnaround is going to be much later in the year. And that is why we have been slightly nervous about this equity market rally extending into late April and early May and that could be a period of weakness.

Coming back to the Bank of America's statement- if you look at default rates in the States, I would argue that default rates are only rising very slightly in investment grade credits. I don't see much of dramatic increase in default rates in areas like credit cars, or student loans, or consumer loans and we are seeing major further write downs on private equity.

Continued on next page