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FXstreet.com (Barcelona) - We are not looking for January 2013 to display a particular tendency to rotation and we have a mix of cyclicals and defensives as overweights and underweights in our recommended sector portfolio.

According to the Economics Research Team at Goldman Sachs, "This reflects our view that global growth will continue to improve, albeit modestly, but that uncertainty remains high especially in 1Q 2013. European growth specifically is likely to remain very weak with a continued sharp recession in the peripheral Euro area." Both the resolution of the Fiscal Cliff and the impact of fiscal tightening in the US creates uncertainty, the timing of any request for a bailout by Spain and the likelihood of early Italian elections all create increased uncertainty.

Moreover, "If these issues are closed or resolved early in the year then we could see the strong performance of cyclicals, technology and financials that we have experienced in previous Januarys (although this is likely to show up as momentum rather than rotation as these sectors have already done well over the past year)." they note.

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