European stock markets mid-session: SNB sends European indices south in volatile trading after early gains

European indices sharply declined after the SNB decided to discontinue the minimum exchange rate of 1.20 per euro and lowered interest rates more into negative territory to -0.75. The surprise move erased early gains driven by a recovery in commodities. The Swiss franc rallied against its major peers and Swiss stocks plunged.

Earlier in the session markets were driven by expectations that the ECB will implement quantitative easing after its policy meeting on January 22^nd after the interim ruling by the European Court of Justice. Yesterday Advocate General Pedro Cruz Villalon of the EU Court of justice in Luxembourg said the ECB's Outright Monetary Transactions program is "in principle" in line with European law and advised the judges to approve the measures.

Investors are looking forward to the European Central Bank policy meeting taking place on January 22^nd and the Greek elections on January 25^th where the anti-austerity party Syriza, that wants to renegotiate debt, is leading polls. According to Moody the "Grexit" seems a relatively unlikely scenario, even if the anti-austerity party Syriza will win in the upcoming Greek elections.

Eurozone's Trade Balance rose less-than-expected in the last quarter. Analysts forecasted the balance to rise to 21.3 billion, 1.3 billion more than the actual reading reported by Eurostat. In the previous quarter the Trade Balance had a reading of 19.4 billion.

In today's session the FTSE 100 index lost declining -0.61% quoted at 6,349.27. France's CAC 40 lost -0.66% trading at 4,195.46. Germany's DAX 30 is currently trading -0.30% at 9,787.87.