Equity markets have defied any expectation of profit-taking - a serious bout that is - but then they have enjoyed plenty of good news, like the prospect of QE, better than expected earnings and a lot of support from corporate activity. Valuations have been attractive too compared to bonds.

But yields in the US Treasury market, as well as other major bond markets, are rising and this coupled with the thought of a loss of global economic momentum, and with this a loss of global earnings momentum, are not so good. A bout of profit-taking has been over due for a while yet equity markets have hung on doggedly to their gains of the past months. If rising bond yields and a loss of earnings momentum won't do the trick you wonder what else can.

David Fuller's view Markets seldom move in a straight line for very long, so after 12 consecutive weeks on the upside some reaction was due, as Fullermoney had forewarned. The question today is how extensive a pause are we likely to see?

My more detailed comments on this subject are inevitably in the Audios, given the efficiency of that means of communication. To summarise those views, starting with global stock markets, we are looking for some mean reversion towards the rising 200-day moving averages. This would most likely result in a combination of smaller (less than 10%) reactions for the less overextended share indices. Some of the more overstretched indices could see somewhat bigger pullbacks, qualifying as corrections.

If these are normal pauses and consolidations within cyclical bull markets, as we think, then we should see more ranging than trending within the short to medium-term patterns which now occur.

Meanwhile, I am somewhat less concerned about a slowdown in GDP growth in the emerging (progressing economies) than Mike Lenhoff. Yes, interest rates are rising but they are still negative relative to rates of inflation. However, at some point rising rates will move above inflation in the progressing economies, creating a stiffer headwind for GDP growth and therefore corporate profits.

I am also less concerned about the initial rise in long-dated government bond yields, which have been at historically low levels in the West and therefore were unsustainable for any environment other than the double-dip recession which appears to be a diminishing risk for the main economies. Furthermore, additional evidence of gradual economic recovery would probably prompt some investors to switch a portion of their capital from bonds to equities, extending the cyclical bull market.

Euroland's debt problems in its Mediterranean states and Ireland remain serious and are therefore still capable of some occasional psychological influence on stock markets in countries further a field. However, they are unlikely to weigh on progressing economy growth prospects.

Lastly, commodities have retained their reputation for volatility and outright corrections have already occurred in some instances. Gold remain a notable exception, although it too is susceptible to MA mean reversion. With less froth in commodity markets, at least for a while, the realisation of investors' worst fears about resources inflation have been postponed.