Markets can breathe a sigh of relief, due to the ultra easy monetary policies, progress in Europe and a pick up in Chinese growth, although there is plenty of event risk, Credit Agricole Corporate and Investment Bank said.

The bank estimated that China's GDP growth in 2013 will be 8.5 percent, firmer than the 7.7 percent the bank estimated for 2012.

"A strong mandate received by the new leadership of the Communist Party of China should boost confidence and the new administration is likely to add to it by pursuing new development goals," said Dariusz Kowalczyk, senior economist with the bank.

The big picture is that China has avoided a hard landing and has engineered a gradual rebound of its growth starting in the second quarter of last year, which will be solid enough to beat its targets, the bank added.

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