The Indian market is a "good place to be" but valuations are at a 50 percent premium besides the economy facing some problems with policy execution and some sectors facing deep stress.

Brexit is going to be a very close vote. It is going to be a knife’s edge either way. What will happen is that there will be an instant reaction by the markets, but actually, there will then be a very longer period of negotiation, if we were to leave. So, I think after that kneejerk response, things will settle down quite quickly to a perhaps prolonged period of uncertainty. So, it is going to be very interesting 2-3 weeks in the UK. The market is probably a little bit on the complacent side in that it expects no change on Brexit. So, if we see a vote to remain, the markets will probably not do too much. If we see a vote to leave, there could be more of a break in the markets potentially.

Brexit really is very important for short term. I think the real thing will be the Fed and probably the things that we cannot forecast, the unknown unknowns that come from that field. And one of the more obvious places there might be say, China where clearly policy is evolving and that could be very influential on markets over time.

The markets have been very bad for an emerging markets investor for past several years. This asset class has underperformed the developed market equities now for several years. So, investors in emerging market funds generally are feeling very beaten up and although you have had that 20 percent rally from the very bottom, it only gets you back to where you would have been a year ago. Actually a lot of investors are making the decision whether the rally is a beginning of something better or is this just a bit of noise in markets which will remain under pressure.

We can certainly see signs of positive change in many respects. So, the Modi government in India, Jokowi in Indonesia, & recently, a new government in Brazil. Companies are beginning to react to the new environments. The Brazilian banks have laid off 10 percent of the staff. They are becoming more efficient. Korean banks becoming branches. Miners and oil companies are again cutting costs, generating more cash flow.

On a wider basis, the trouble with our asset classes is that it is very cheap. Sort of a significant discount to its history, significant discount to the developed world, but companies are still under very significant pressure. And that makes it difficult to make a compellingly positive story at this point.

Unfortunately, it is too early to say that the earnings are bottoming out but a bit of a turning point is seen. So, what we are seeing is signs of a response by electorates, by politicians, by banks, by companies, by just the people of emerging markets. But it is too early to say whether that is going to feed into a positive earnings trend or not. I would say that I would be cautiously optimistic, but the word cautious is not as important as the word optimistic.