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

UK 100 Index called to open flat at 7210, unable to better 7220 overnight as early Jan resistance-turned-support reverts to resistance following yesterday’s breakdown. This maintains Monday’s trend of falling highs and also confirms a bearish head and shoulders top reversal that could take the index back to 7070. Bulls need a breakout to 7230 to overcome with week’s downtrend. Bears require a breach of yesterday’s 7190 lows . Watch levels: Bullish 7225, Bearish 7185.

Calls for a flat open come after small losses on Wall St last night and a mixed picture in Asia overnight. Investors are looking ahead to this afternoon’s inauguration of the 45th US President, even solid overnight Chinese GDP failing to provide any meaningful positive impetus overnight. If anything, it is a weaker USD having most impact, after a slightly less hawkish tone from Yellen, the stronger resulting GBP and EUR hindering UK Index and DAX sentiment.

Japan’s Nikkei is posting gains in spite of Yen strength (weak USD or safe haven seeking?) and a weak Energy sector while China bounces back from yesterday’s losses thanks to its solid overnight GDP and Retail Sales print, even if Industrial Production and Fixed Asset Investment were a touch light. Australia's ASX is the regional underperformer as Financials and the commodity space (energy in particular after yesterday’s US Oil inventory build) hold it back.

US equity markets closed lower across the board as markets digested comments from Fed Chair Janet Yellen and investors reposition themselves ahead of tonight’s inauguration. The Dow Jones posted its fifth straight negative session (-0.4%) as Financials once again led losses on concerns Trump may not follow through with sector deregulation. Real Estate led the S&P lower, also by 0.4% while the Nasdaq again outperformed, albeit still 0.3% lower as profit taking hampered markets.

Crude Oil prices continue to hover around 2017 lows as US inventory data yesterday showed a larger than expected draw and reports Chinese demand for the commodity could fall in 2017. Non-OPEC supply concerns (most notably in the US as markets see shale making a comeback in 2017) continue to place downward pressure on crude markets, especially given yesterday’s data, as the OPEC supply cut deal attempts to rebalance global supply.

Gold price has recovered from yesterday’s sub-$1200 level as safe haven marginally increases and the USD falls back from yesterday’s highs in anticipation of this evening’s inauguration in Washington. A close above $1200 will mark a fourth straight week of gains for the precious metal, in what would be its longest run since July.

In focus today will be the inauguration of Donald Trump as the 45th President of the United States, with investors hoping that his speech comprehensively outlines his policy plans for the next four years in a scripted rather than lively off the cuff affair. Financial deregulation, infrastructure spending and tax reforms will be the key policy topics markets will be hoping receive some dedicated airtime this evening.

Data-wise, UK Retail Sales at 9:30am are forecast to provide a mixed bag, with the monthly headline and core figures seen falling back into negative territory for the first time since Junes while the YoY figure is seen improving to approach October’s 13 year highs. Note following a strong Christmas performance from UK Retailers (Next excluded) there is some potential for upside surprise this morning.

Away from Washington, speakers of note include the Fed’s Harker and Williams this afternoon following on from overnight comments by their boss Chair Yellen that seemed to strike a less hawkish tone than her Wednesday night address suggesting rate hikes steadily through to 2019.

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

• Bonmarche 3Q Sales, Margin Up
• Character Group: Adverse Forex to Hit 1H17 Results; Sees FY17 in Line
• Record 3Q Assets Under Management Equivalents Rise
• National Express Appoints Chris Davies Finance Director; Matthew Ashley to Become N. American CEO
• Antofagasta ALTO MAIPO PROJECT
• Close Brothers Sees Strong 1H17, Good Outcome for FY17
• Synthomer Sees 2016 Results Higher than Top End of Views
• Biome Technologies Sees 2016 Revenue Down 6%
• MySale 1H Underlying Earnings Double After Reducing Costs
• Elecosoft's 2016 Adj Pretax Profit to Beat Market Expectations
• Bloomsbury Publishing Chairman Anthony Salz to Step Down July