The US markets ended near session highs, but still closed narrowly mixed, as worries over the Eurozone and declines in the energy sector limited gains.

On economic data front, US economy expanded at a moderate pace in late November and December as consumer spending picked up, according to the Federal Reserve's latest beige book report. Meanwhile, weekly mortgage applications gained in the first week of 2012.
And in key data to watch out for in US today, weekly jobless claims are expected to come in slightly higher at 375,000. And retail sales may rise to 0.4% for December. Meanwhile, the business inventories is expected to come in at 0.5%

European markets closed lower as bearish comments by Fitch and strong demand for safe-heaven German bonds triggered a sell-off after a recent strong run.

But here's the big jolt that spooked investors in Europe. Rating agency Fitch noted that the European Central Bank should ramp up its buying of troubled euro zone debt to prevent a "cataclysmic" collapse of the euro.

The head of sovereign ratings at Fitch, David Riley said that the collapse of the euro would be disastrous for the global economy, and while it is not Fitch's baseline scenario, it could happen if Italy did not find a way of its debt problems.

The ECB will hold a policy meeting today. The committee is expected to keep interest rates on hold at the historic low of 1%, and hold back on further action, despite growing calls for the bank to resort to quantitative easing. The meeting happens as calls for the central bank to take further action to solve the euro zone debt crisis increase.

Meanwhile, the meeting between German chancellor Angela Merkel and Italian prime minister Mario Monti discussed austerity and reforms, wherein the Italian premier hinted at acknowledging his country's tough reforms by the Germany and the eurozone.

Meanwhile strong sale of German bonds sends a bearish signal ahead of Italian and Spanish auctions today. Germany sold 3.153 billion euros of new five-year notes, drawing more demand than in a previous auction in December 
In crucial auctions today, Spain is all set to sell 3-4 billion euros in 3-year bonds while Italy will sell 8.5 billion euros worth 12-month treasury bills and 3.5 billion euros worth flexible treasury bills

In the currency space, the euro dipped below 1.27 to the dollar, falling to a 16-month low, after ratings agency Fitch urged the ECB to ramp up buying of eurozone debt to prevent a "cataclysmic" collapse of the euro

In commodities, crude prices decline marginally, as fuel supplies climbed more than expected and concern mounted that a contracting German economy will drag Europe into recession. Brent currently hovering above USD 112 levels. From the precious metals space, gold prices gained, currently trading above USD 1640.

And back home, markets, big boy Infosys declares its numbers today. Dollar revenues are expected to come in towards the lower end of the guidance at about 3.37% sequentially. Margins are expected to gain by about 200 basis points.

Also, The crucial IIP data for November comes out today. A CNBC-TV18 poll sees Nov IIP at ~1.6% versus minus 5.1% in October.