Japan: Short term uncertainties, long term reconstruction opportunities
==============================================

- Japan is still struggling to contain the Fukushioma Daiichi nuclear station.
Today's report by UBS AG affirms that the Fukushima crisis has casted serious doubts on "whether even an advanced economy can master nuclear energy". According to UBS this could eventually trigger a re-evaluation of nuclear energy by both governments and insurers.

- While forecasts of Nomura and HSBC see Japanese GDP contracting in the short term, reconstruction driven growth is expected in Q4 and in 2012 opening a series of opportunities (see strategy below)

Europe: Can one size really fit all ?
=====================

- With inflation in the Eurozone at 2.6% in March a symbolic rate increase is highly expected.
- Despite the critics I believe that a rate increase is consistent with the Central Bank mandate to guarantee price stability.

- As Spain, Portugal, Ireland and Greece account for 17% of the Eurozone GDP I think that a modest increase will address the need of core European economies (including protecting savings that are now dealing with real negative interest rates) without making a big difference for peripherals Economies.

- Much depends if this increase will be followed by a series of increases. A series of increases between April and the end of the year might pose significant treats to consumers in peripherals economies having to cope with variable mortgage rates and contracting economies.

Commodities: A new high

- Now at a two years high commodities see no sign of slowing down. This is due to a combination of increased demand and weakness in the US Dollar (due to the high level of money printing).

With World daily oil consumption at 90 million/bbl (an all time high) there is no sign of slowing demand but a lot of uncertainties on the supply side. For this reason I remain positive toward commodities.

Strategy: A World of opportunities
======================

- Among the sectors I see as interesting there is generics pharmaceutical companies, including Japanese ones, on specific growth in this sector (based on expiring patents and health care spending pressures).

- Japanese construction companies (steel, glass, builders, cement) present a good investment opportunity for the reconstruction in the affected areas.

- European banks are, selectively, interesting as their operating environment is set to improve with the rate increase (IF there is no restructuring or default in Sovereign European debt).