John-Paul Smith, global emerging market equity strategist, Deutsche Bank expects European summit and the G20 meeting to be held in November to announce relatively joyful resolution for Europe.
However, he forsees prolonged period of fiscal austerity across large number of European countries unless Germany agrees to a more distributive fiscal regime. Despite the relief rally seen in the markets, the growth in Europe in medium term would be lower. "This will have a severe impact for most of the emerging markets (EM) universe," he added. Further, emerging markets are unlikely to witness a sharp pullback from current levels since valuations across all EMs are pretty low. "In relative terms however I have got little doubt that emerging market equities will continue to underperform against developed market equities particularly the US," Smith added. Below is the edited transcript of SmitDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
