London pre-open: FTSE to open sharply lower

- FTSE to drop as risk appetite weakens- Japanese data comes in below expectations- All eyes on Wednesday's Fed meetingCity sources predict the FTSE 100 will open 60 points below Friday's close of 6,663.7, with investors feeling risk averse ahead of a key week for markets and after Japanese data released over night showed the country's annual trade deficit climbed to a record high. The FTSE 100 suffered triple-digit falls on Friday, dropping to levels not seen in over a month as volatile conditions in emerging markets spread fear amongst investors across the globe.The index closed 109.54 points down at 6,663.74, a fall of 1.6% on the day. The last time the index closed lower was on December 20th 2013.As Market Analyst Craig Erlam from Alpari explained, "the sell-off in emerging market currencies created a fair amount of panic last week and is only likely to spur further panic going forward about the impact on Fed tapering on the emerging markets". The weakness in emerging-market currency markets - the Argentinian peso, Turkish lira, Russian ruble, Ukrainian hryvnia, South African rand and Brazilian real - prompted investors to shy away from riskier assets and move towards safer investments during Friday's session.Markets were still reacting to data released last week that revealed a surprise contraction in China's manufacturing sector this month, as well as to a poor batch of economic figures from the US on manufacturing and existing-home sales.The coming week will see the Federal Open Market Committee meet on Wednesday, with another $10bn reduction in the US central bank's pace of quantitative easing being widely expected.Meanwhile, back in the UK the most pressing issue for the Bank of England is tackling the legacy of past errors, Governor Mark Carney revealed over the weekend. Also making headlines were reports that customers of TSB, Lloyds and Halifax were unable to use their cards and cash machines, leaving them with no means by which to purchase goods. In company news out this morning, natural gas producer BG Group said that 2013 results will be in line with expectations, although production this year will likely be lower due to "short-term issues" in Egypt and the US. 2013 production volumes came in at 633 thousand barrels of oil equivalent per day (kboed), in line with its guidance. However, estimates for 2014 have been revised with production volumes now expected to come in between 590-630kpoed, which Chief Executive Chris Finlayson said was "very disappointing".Engineering software firm AVEVA said that since its last update in November the group had continued to perform well amid soft market conditions in Latin America and good progress in the US and Canada. It added that the Asia Pacific region continues to grow at a steady rate, with continued strength in South Korea outweighing the generally weaker economic conditions in China.ARM Holdings has appointed Stuart Chambers as Chairman to replace John Buchanan who is stepping down due to a medical condition. Chambers, Chairman of Rexam and a Non-Executive Director of Tesco, will succeed Buchanan on March 1st. NR