Great rotation: From equities to… equities?

Investors and analysts spent a lot of 2013 talking about the "great rotation" – how floods of money would exit the fixed-income markets to the benefit of global stocks. It made for fantastic headlines, but more importantly, it seized a very elementary fact: that bonds weren't looking as good as equities.

By the end of last year, however, it emerged that that there could, in fact, be buyers of both stocks AND bonds. And now another question has come to the fore: Will 2014 see another "great rotation": a shift from outperforming stock markets back into the, comparatively speaking, underperforming European equities?

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Let's briefly recap. Despite the exhausting uncertainty over the global economic recovery and tapering of the U.S. Federal Reserve's massive bond-buying program, stocks surged in 2013. U.S. equity markets catalogued their strongest year since 1997 with the putting on gains of 30 percent, the Nasdaq index was up 38 percent, and the Dow Jones gained 27 percent in its best year since 1995. The Dow and the S&P 500 both finished the year at record closing highs.

(Read more: BlackRock CEO sees 'Great Rotation' in bonds)

In Asia, the outperformer was Japan's Nikkei 225 which added 52 percent; helped along by Prime Minister Shinzo Abe's monetary and fiscal policy overhaul to get to grips with the country's 20-year deflationary stagnation.

In Europe, the strongest performer of the major indexes was Germany's Dax which rose 23 percent. In comparison, France's CAC added 18 percent, Spain's IBEX rose 21 percent, and the Italian MIB added 'just' 12 percent. In the UK, the FTSE closed out 2013 up 14 percent.