The two big macro themes that have concerned the markets recently haven’t changed – the Fed’s Tapering and Abenomics. US Treasuries saw a 50bps rise in yields during May yet the SPX had a positive month. The Fed Chairman Ben Bernanke must certainly be pleased so far by the market reaction to the talk of tapering. What we saw in the markets in May was “volatility” and not “weakness”. Selling in May, didn’t pay. In my May newsletter, I suggested – don’t be a grizzly bear (sell the equities and go short the market) but be a teddy bear (stay invested and buy some out-of-the-money Puts). I still have the same advice for the month of June. The deterioration in German retail sales and the rise in the number of unemployed in Germany have focused the minds that the malaise in Europe could be heading to the core and there is expectation of further European Central Bank (ECB) actions. Rising home prices, declining initial jobless claims and better job creation numbers are boosting US consumer confidence. This bodes well for the US equity markets. Despite the recent correction, the medium to long-term case of Yen weakness and Nikkei strength remains. I would advise against investing in commodities at this time, unless the macro picture for China and the global economy gets clearer. Gold bears will continue to win and so will Copper bears.