We are seeing this in the recent round of earnings releases - it's becoming more challenging for companies to make their numbers, but they are optimistic and looking to support internal growth with acquisitions.

In some respects what we're seeing in 2006 is companies are becoming more optimistic. They're looking at their rivals to see who's going to start upping investment levels first.

Private equity likes retail because of the real estate element. There is plenty of hidden value in the owned and leased real estate in these companies' portfolios.

Any company with a lot of hard assets is good for a complicated debt structure, which is always attractive to financial buyers.

Earnings season is always volatile and we're just going to have to watch it. What companies say can throw a monkey wrench into market action or be a catalyst, and we have a lot of big companies reporting in the next few days.

Corporate earnings reports are going to be centre stage ? we're in that phase of the year. Recent reports have been cautious and we're going to see if that trend continues ? if it does the markets may remain negative.