Markets Overview: (Source: Bloomberg, FT, Reuters, DJ Newswires)

UK 100 Index called to open -25pts at 6475 after yesterday’s Swiss-induced market volatility seeing the rebound from 6350 flounder to test new lows of 6300 before rebounding to highs of 6500 and then losing momentum overnight. Still in downtrend from early December with resistance at 6530 and the convergence of 20/50/100-day moving averages thereafter. Watch levels: Bullish 6520, Bearish 6410.

The negative open can be attributed to a weak finish by US bourses following more disappointing US Q4 results from Bank of America (BAC), Citigroup (C) and Best Buy (BBY), oil retracing gains and mixed data. Tech giant Intel (INTC) beat after the close but with a poor outlook, Schlumberger (SCL) was mixed, and there is speculation of BoJ officials getting nervous about QE’s negative side effects.

Asian stocks in the red, following Switzerland’s surprise removal of its 1.20 CHF/EUR cap and global FX knock-on, but Japan’s Nikkei off worst levels thanks to JPY stabilisation at lows while Australia still hindered by stronger AUD as well as low commodity prices and global growth uncertainty.

Still much anticipation about ECB and a full-on QE decision next week which could see the Euro currency weaken further and whether it will be equal/balanced across the Eurozone region and if Greek election outcome could hold influence.

In focus this morning we have had German Consumer Price Inflation (CPI) confirmed at flat in December and barely positive annually. Later we have the Eurozone figure expected to be negative and highlight deflationary pressures facing the ECB and its price stability mandate.

In the afternoon, US Consumer Price Inflation (CPI) is forecast to be even weaker in December dragged by the lower oil price although the core figure likely kept its head above water. US Industrial Production is seen dropping in December along with Manufacturing and Capacity use, although the Uni of Michigan sentiment indicator is forecast to have gained ground.

Results-wise, after the disappointment from JPMorgan, BoA and Citigroup, all eyes on Goldman Sachs (GS) to deliver better results than peers and provide a bright spot for the banking sector and financials.

Gold trades near a four month high, having managed to complete its bullish flag pattern at $1260 we had been highlighting for the last week or so thanks the Swiss CHF/EUR cap abandonment sending FX markets into a frenzy. The metal now trades above falling highs from October 2012 and more importantly above the 200-daty moving average which could signal a trend change and allow for further advances.

Oil has retraced its gains after OPEC said it expected weaker demand for Crude and US output climbed to the highest since records began in Jan 1986. US Crude down at $47/barrel and Brent at $48.5 with both showing some stabilisation/base-making signals and trend of rising support from 13 Jan lows.

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Key Overnight Macro Data: (Source: Reuters/DJ Newswires)

• Germany             Consumer Price Inflation              In-line 

See Live Macro Calendar for full data line-up, incl. consensus expectations

UK Company Headlines: (Source: Reuters/DJ Newswires)

• BP says reviewing court's decision on Gulf oil spill trial
• Essenden CFO Richard Darwin steps down
• Spectris Q4 sales rise 5 pct
• JD Sports year profit to beat forecasts after strong Christmas
• Synthomer says trading has been in line with board's expectations
• Dialight sees FY results in line with market expectations
• John Menzies says trading has continued to be in line with forecasts
• moneysupermarket.com sees FY earnings up 13 pct
• Acacia Mining 2014 production comes in ahead of guidance
• Partnership Assurance Group says not to proceed with bond offering
• Sainsbury's to change auditor to Ernst & Young