DEUTSCHE Bank says the correction recently seen in Asean stock markets is healthy and only temporary, as there is no real structural change behind it- Its managing director and head of research Malaysia and Asean, Teoh Su-Yin, said healthy profit-taking and accelerating inflationary pressure in Asean are partly the reasons for the correction- She explained that relatively positive data points coming out of the US, which tends to favour the North Asian markets, have also encouraged flow of funds out from Asean into North Asia- "We do think this is a temporary measure, and we continue to like the Asean market, but have to admit that we may not see such strong performances as we saw last year," Teoh told reporters after its Market Outlook 2011 briefing in Kuala Lumpur yesterday- Last year, Asean countries such as Thailand, Malaysia, Indonesia and the Philippines were the top four markets in terms of value in Asia- In recent days, however, last years' standout performers Indonesia and the Philippines, have declined from recent highs, indicating a pending correction- The house has set a 1,790-point target for the benchmark Kuala Lumpur Composite Index in 2011- This will be supplemented by 22 per cent growth in core corporate earnings, or reported earnings of 26 per cent- Growth is to be supported by a broad base of industries, mainly the palm oil companies, growth coming from Indonesia through banks like Maybank Bhd and CIMB Bhd, Petronas Chemicals Group Bhd and the property and construction sectors, which have seen a rise in margins- Teoh said the view of Malaysia as a "dull" market is increasingly redundant, calling it a growth market- "Malaysian companies offers an Asean footprint that you cannot find in the rest of Asean, with a third of its earnings coming from outside the country," she said- ...

More