Back at the beginning of April, into mid April, we had clear sell signals from the models - risk appetite models, the put-to-call model, sentiment models - all sorts of models for giving clear one to two months' sell signals.

Well, with markets moving so dramatically in recent weeks, since mid-April in Europe, since really 10, 12 days ago in the States, the models have now also moved dramatically, such that they're giving a clear buy signal.

Risk appetite gauges on a one to two month view are back on buy, put to call model is back close to buy, other indicators show the market's oversold, momentum's oversold and with equity should rally strong and hard from here over the next one to two months. That supports the buy stance of equities.

On top of that we have macro which is very positive. And we also have announcements from Ecofin and the ECB over the weekend. Those announcements mean two distinct separate things.

Firstly, a bunch of announcements from Ecofin, the European Unions Finance Ministers, whereby they've announced both a stabilisation fund for eurozone sovereigns across Europe who are in trouble, worth EUR60bn, over and above what we've seen to Greece.

And, secondly, a special purpose vehicle to guarantee other eurozone countries' debt, where necessary, of EUR440bn.

All of that topped up by the IMF, adding another 50 per cent to the total, bringing it to about EUR720bn - EUR750bn of support for sovereign debt in the periphery Club Med countries where they're countries and any other countries where there are troubles. That's the Ecofin.

Also the ECB, in conjunction with other central banks around the world, have made announcements. The Fed has reopened its US dollar swap liquidity facility to enable liquidity to flood the Western and world financial system where there's a dollar shortage.

And, secondly, the ECB has announced a number of other measures, a number of auctions coming over the next few days, starting on 12 May. Thirty day auctions, 3 month auctions - to provide lots of liquidity to the European banking system.

And on top of that the ECB is going to be buying eurozone sovereign and private sector debt where markets are dysfunctional, i.e., no doubt buying Greek sovereign debt, Portuguese sovereign debt, Spanish sovereign debt and maybe even Italian.

As such, the liquidity provision, the stabilisation fund, the back stopping of poor sovereign credits in Europe should add fuel to the risk rally from here.

And the third key reason is the macro. Global macro is basically fine. The global economic cycle continues. That was re-enforced, that message, from macro data last Friday. The payroll data in The States was good. Job creation was strong. There were more jobs created in prior months than expected, the working week was growing, earnings were growing, employment is going up - positive.

On top of that we had the leading economic indicators from the OECD last Friday emphasising the global economic expansion continues and, importantly, positive growth in China, where we continue to be concerned about the risk of over-tightening and slowing the economy too much. That was countered by good leading economic indicators out of China on Friday.

So the key risk for macro remains, or was last week, that the sovereign debt crisis in Europe tightens credit conditions in the European banking system and slows the growth. That now has been countered by the Ecofin and the ECB statements. Credit conditions shouldn't tighten dramatically from here. As such, the key risk to the continued expansion of the global economy goes away as a result of these moves by the European authorities.

As such, therefore, the global cyclical bull market continues. In our view we remain in phase two of a stylised cyclical bull market. Phase one, you'll remember, is the strong, rush out of the gates, out of the bear market, out of the recession. Phase two, which we entered a number of months ago, is the consolidation of those gains - six to nine months, sideways to modestly down equity markets.

And, as such, in that environment every pull back, where the medium-term indicators move to buy, is an opportunity to put risk back on the table, at least for the short term.

So, in summary, we remain and we move overweight equities for three key reasons; the models, which are on buy; the macro, which is positive; and the resolution, at least temporarily of this European sovereign debt issue.