Investors wary after Wall Street signed on comments from a Federal Reserve official. John Williams, President of the San Francisco Fed said the central bank's bond-buying could soon be wound down. William de Wijlder, Chief Investment Officer at BNP Paribas Investment Partners in Brussels says the euro stock rally is starting to fade.

SHOWS: BRUSSELS, BELGIUM (REUTERS - ACCESS ALL) (MAY 17, 2013)

1. BNP PARIBAS INVESTMENT PARTNERS IN BRUSSELS, CHIEF INVESTMENT OFFICER, WILLIAM DE WIJLDER, SAYING:

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(QUESTION: William, well, stocks are up for the fourth week in a row this week perhaps but the magnitude of those gains here in Europe is falling 4%, 2%, 1%, possibly sub-1%. Is this rally fading now?)
It's losing a bit steam and in a way it's a positive sign because if it would continue to power ahead, always on the same topic, meaning liquidity injections by central bank, it would become pretty scary in respect to valuations. It's also an obvious reaction of course to the news coming from the Fed that Bernanke last week saying he's worried about excessive risk taking and now, Mr. Williams is saying that they'll start to think about tapering.
(QUESTION: And two minutes into trading today and the FTSEurofirst down 0.25%. The DAX down 0.1% and the FTSE almost flat. So, coming off a little bit. As we are talking about the Fed, if the Fed is to taper its QE in the summer, how do you play that?)
Well, what's going to happen of course is that the bond market volatility will increase and that bond yields at least temporarily will move up until there is more clarity on when they would stop with QE all together. I would also suspect that equity markets will have a tougher time because the driving factor of the rally for the past several months will fade away. That means that bond and equity correlations will move positive whereas typically, over the past couple of years they have been negative. That means that bond volatility, equity volatility, the only place to go is to reduce risk and I think that international investors will, as a consequence, be more inclined to invest in Dollar.
(QUESTION: So you say buy the Dollar, would you buy the index or would you buy against any specific currency?)
Well, I think it will, the Dollar will be supported at the index level. Being a Eurozone-based investor, I will specifically look at Euro/Dollar of course but the dominating theme that you see across the globe is that any central bank that has possibility to cut rates is doing that. That is also inspired of course by a kind of retaliation if I can say, vis-a-vis Japan, whereas the US is actually the only economy which is apparently now shifting into higher gear so that would justify tapering. So that means it should support the Dollar Index.
(QUESTION: Okay, just to finish up. We've had earnings out this morning from the shipping container giant, Maersk. Profit fail but it wasn't as bad as expected. Do you, as an investor look at global trends and global trade patterns? Or has QE simply washed over everything?)
Well, QE has washed over. Now, what QE is doing, it's actually doing two things. It's trying to boost activity and it's also buying time. And investors are really reacting to QE because they hope that eventually, it will be successful. That is why the evidence which came out this morning, well, the news which came out this morning is very important and it's kind of comforting. I don't want to overblow it but really, the key tests for the remainder of the year is going to be do we see bottom-up evidence that it is working. We have already evidence on the top-down level at the macro-level that is working. We need to see bottom-up evidence because let's not forget, earnings have been going nowhere for several months now and we need evidence of this picking up here.'