Europe seen lower; oil weighs

European equities are expected to open in negative territory on Tuesday as oil prices continue to fall.

The FTSE is called down 20 points at 6,481, the German DAX down 3 points at 9,779 and the French CAC down 7 points at 4,221.

Oil prices slumped more than 5 percent overnight, extending the second-deepest rout on record, after Goldman Sachs slashed its short-term price forecasts and Gulf producers showed no sign of curbing output.

U.S. crude settled down $2.29 at $46.07, its lowest level since April 2009. Brent crude was last down about $3 to $47.24 a barrel, after dropping as low as $47.18, its lowest level since March 2009.

The meltdown in oil prices has shaken global markets. Asian shares were mixed on Tuesday, as traders weighed a better-than-expected trade report from China and the continued fall in global oil markets. Meanwhile, U.S. stocks lost ground on Monday, extending a two-week decline, as worries about falling oil prices took hold before the start of quarterly earnings.

In other news, following the terrorist attack on its offices in Paris in which 12 people died, French satirical magazine Charlie Hebdo decided that this week’s edition, due to be published Wednesday, will show a cartoon depicting the Prophet Muhammad holding a “Je suis Charlie” sign, according to various reports.

Elsewhere, divers have retrieved the cockpit voice recorder from the wreck of an AirAsia passenger jet on Tuesday, MetroTV said quoting a transport official – a key piece of evidence for investigators to determine the cause of the crash that killed 162 people, Reuters reported.

Investors in the U.K. will closely watch December inflation figures as well as the latest trading updates from retailers WM Morrison, Debenhams and ASOS.

 Varchev Traders

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