If China's economy does simmer down, it will have an adverse impact on the materials sector, and on commodities, including oil,

Rotation is indeed a reality but, if the economy is doing better, tech stocks will lead it because they are the new industrials.

Investors are looking past those challenges and seeing an economy that's still got a good growth rate and are preferring to take a risk with their portfolio than not.

It should not be introduced at high levels, where it will shock the economy. Instead, the GST should be gradually eased in and the list of taxable goods expanded over time.

The economy could get back to an above trend rate this quarter, and that is what will matter to monetary policy makers.

The question is what catalyst will get it going. My guess is more signs of a stronger economy. That might be higher interest rates, but you may need that to get small caps going. They may improve as the bond (goes down).