CIMB has published its 2014 forecast for the Australian equity market. Here's a quick summary of its expectations and recommendations for next year: 1) S&P/ASX200 to rise by 6 per cent 2) Market's PE of 14.8x to decline by about 1 point. Less Fed stimulus and a pick-up in earnings growth means we are likely to see some PE compression. 3) The baton to be passed from defensives and consumer discretionaries to global cyclicals. 4) Analysts expect JBH, CSL, WOW, RMD, BHP, MTS and ALL to see improving returns on invested capital. 5) In contrast, they expect OZL, ILU, UGL, OZL, GFF and IMD to see declining returns on invested capital. 6) Earnings downgrades to find a floor.