'Double digit returns expected from US equity mkt this yr'

Kirk West, MD -Asia, Principal Global Investors believes that risk trade is back on rather than receding. He feels that the US markets could fetch a healthy double digit return this year on equities. They are also constructive on Japan.

Below is the edited transcript of his interview on CNBC-TV18. Also watch the accompanying video. Q: It seems like the risk appetite is receding globally. What are the concerns that emerged from China and how do you think equity market should approach it now? A: A lot of risk trade appears really to be back on rather than receding and continues to be supported by the accommodative global monetary policy. The news on China was some concerns over growth and that was really from a feedback from BHP but I think that is just short term noise. Q: How much more of an upside then you think is there for global markets considering you also mentioned that risk on is back? How much more upside can we hear in the short term? A: In regards to equity we are very constructed particularly in case of the US. The US market could be a very healthy double digit return market for the year. We are already seeing quite good single digits but we think that could go well into the double figures. We are also very constructive on Japan and even in the case of Europe, it will be relatively flat and that would be a good outcome for Asia.