- SNB's Jordan defends BoJ actions
- G7 reiterates commitment to market FX rates
- Italian and Spanish bond yields fall

FTSE-100: 0.33%
Dax-30: 0.11%
Cac-40: 0.39%
FTSE Mibtel 30: 0.15%
Ibex 35: 0.85%
Stoxx 600: -0.03%

By the midday mark European equities were registering small gains. The 'risk-on' attitude was benefitting from remarks by G7 leaders in support of 'market-driven' foreign exchange rates as well as supportive comments for the Bank of Japan's recent policy decisions. The latter may possibly be interpreted as reducing the risks of unwanted tensions.

Thus, the Governor of Switzerland's central bank (SNB), Thomas Jordan, today stated that "Japan and the Japanese central bank are trying to change policy in the direction to avoid deflation and in order to stimulate growth."

In a similar vein, Morgan Stanley's Chief Economist, Joachim Fels, had this to say on Sunday regarding the BoJ's actions "there is nothing wrong with this: further downward pressure on the yen will merely be the side-effect of the BoJ trying to achieve its new 2% inflation target - the same target most other major central banks have.

"And to make sure that they don't miss their own inflation targets due to currency appreciation, other central banks will simply have to ease policy further, too. The end result? An even easier global monetary policy stance, whether policy-makers like it or not. I know who will like it: so-called risky assets."

That comes ahead of tonight's State of the Union address by President Obama and with several members of the US Federal Reserve being slated to speak this afternoon.

Overnight Standard&Poor's lifted its outlook on Ireland's sovereign debt to positive from stable.

Yields on the €8.5bn of Italian 12 month notes on offer at a Treasury auction this morning rose to 1.094%, versus 0.864% the last time around. In the secondary market however Italian 10 year bond yields are now falling notably, and are down by 14 basis points.

Michelin plummets after results

Michelin is moving lower after announcing operating profit of €2.42b, a tad below analysts' estimates. Yet what has really unnerved investors is the company's warning that sales and earnings will likely not grow this year due to the recession on the Continent.

Shares of Italian defence giant Finmeccanica are plummeting after police arrested Chief Executive Officer Giuseppe Orsi. The police are investigating the sale of 12 helicopters to India.

TomTom NV is sinking by 7.1%. The firm's Chief Executive said he cannot predict when the company will return to growth.

From a sector stand-point the best performers today are: Banks (0.98%), Technology (0.51%) and Real estate (0.42%).

Light data calendar
The French current account deficit worsened to €3.6bn in December (Consensus: €3.5bn) from €2.8bn in the previous month.

Other asset classes trading mixed
The euro/dollar is now edging higher by 0.34% to 1.3449.

Front month Brent crude futures are now rising, by 0.438 dollars to the 118.65 dollar level on the ICE.



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