The last few days have seen the resurgence of the reflation trade and led to underperformance in growth stocks, especially global tech megacaps. The market set-up today is similar to the February/March reflation period and we expect markets overall to experience a soft patch with small cap and value outperforming. We think the second leg in the reflation trade could take bond yields to the upper end of their pre-Covid trading range and a make or break situation in summer. If bond yields top out at the upper end of the range, growth stocks should stage a comeback in H2 2021. A sustained break of 3.0% in the 10Y Treasury or 2.2% in the 10Y Gilt could lead to inflation expectations getting out of hand and value extending its outperformance well into H2.