Asia: Asian equities outlook good if no recession

There are many reasons to be cautious about the short-term Asian equities outlook. Valuations now stand at a 10% premium to developed world equities, operating above the long-term world trend to trade at a 15-20% discount. Asia ex Japan returned 37% in dollar terms last year, and 279% since the dawning of the bull market in March 2003. While this is justified by superior earnings growth, and improved structural economics, management and corporate governance, risks have increased, and Asian equity valuations (China in particular) do not effectively discount probable volatility. The full ...