Benign liquidity situation to support markets: Kalpen Parekh

Parekh says investors should temper their return expectations as interest rates have fallen over the past three years and valuations have stretched considerably

A benign liquidity situation along with a pick-up in earnings, both globally and locally, will continue to support markets despite above-average valuations, says Kalpen Parekh, president, DSP BlackRock Mutual Fund. Parekh tells Ashley Coutinho in an interview, that investors should temper their return expectations as interest rates have fallen over the past three years and valuations have stretched considerably. Edited excerpts:

What is your outlook for the market? 

While Indian equities have performed well (up about 23 per cent this year), they are not an outlier as they have underperformed the broader EM (emerging markets) index. Hence, we believe this is a