Macquarie Sec: 5% upmove left in Indian market in CY13

In an interview to CNBC-TV18, Richard Gibbs, global head of Macquarie Securities spoke about his outlook for the Asian markets.

Below is an edited transcript of his interview Q: What have you made of the sudden weakness we have seen across some of our Asian peers—the likes of China, Japan etc?
A: It has been quite interesting because in the last 24 hours we have had a much shift in global mindset in relation to global liquidity going into 2014. That is to say that unconventional monetary policies that are been implemented by the major central banks are expected to continue into 2014. It’s exacerbating those exchange rate pressures that is coming through with some concerns on the earnings front today and it means that the Japanese authorities are going to have to maybe redouble their efforts in terms of quantitative easing to reduce the pressure, the exchange rate pressure we are seeing with the yen at this point in time.
So, interesting that we are at a critical juncture in terms of expectations moving into 2014 and at the moment they are playing against the Asian markets. Q: We are trading at the highs that we had seen in 2008, so they are not highs but still compared to what we were month ago we are now 16 times our FY14 earnings; some would say that is expensive. Do you think in spite of it we could see more 5-10 percent gains in this market?
A: I think we can and I said that a week before and still I would stick by that and as I said the developments in the last 24 hours with the major central banks and including the Bank of Canada with very accommodative tone coming through now into 2014, all go well for the emerging markets, all go well for the Indian markets. So, while you are saying stretched valuations, I do not think it is stretched to some markets by the way.
We can probably get up to 18 times before start to become a big concern but that means there is another 5-10 percent in this market in this calendar year.