By Greg Peel

The Dow fell 21 points, or 0.2%, while the S&P was basically flat at 1517 and the Nasdaq was similarly little changed.

A Goldman Sachs report released on Friday afternoon went largely unnoticed on Wall Street, while the focus for most lay squarely on getting home by any means. Those who managed to struggle back in last night found that Goldman had downgraded its call on global equities to Neutral from Overweight.

The good news is Goldman retains its Overweight view on equities over a twelve month horizon. The Neutral call is for a three month horizon, with the strategists feeling US equities have run too far when US fiscal and European sovereign risks remain. They do not, nevertheless, see any major pullback in the offing. Any sell-off would not be "long-lived or particularly large," they suggest.

Furthermore, Goldman is not a great fan of US equities anyway, maintaining an Underweight regional call on the US within the global Overweight, with Asia ex-Japan the balancing regional Overweight. If anyone is wondering, despite what some politicians might like us to believe, Australia is not officially included in the region of Asia ex-Japan. Australia nevertheless benefits from Asian strength and is a popular, secure investment proxy for Asian strength.

Speaking of European sovereign risk, eurozone finance ministers are currently meeting to determine what to do about Cyprus, which has been waiting in the wings for a bail-out since about September. Half a Greek island is not going to bring down global financial markets, but Cyprus is a timely reminder of problems that have not been resolved. Markets will probably be unfazed by any Cypriote bail-out argy-bargy ahead of the headline act, which will be the Italian election on the weekend after next. One is reminded that ahead of last year's Greek election there was much concern no one party would have the numbers to form a government, yet equity markets continued to rally into the election nonetheless. When no government was forthcoming, down they went. And Italy has a history of not being able to form governments.

Funnily enough, Italy is a member of the G7 (which indicates just how big the Italian economy really is) and the G7 is currently mulling over ideas on how to avert the so-called Currency War, which members would deny is going on, but everyone else knows is quite obviously going on. The G7 may issue a statement suggesting the group is committed to market-determined exchange rates. They'll probably get Lance Armstrong to read it.

Last week the French president, frustrated by the strong euro, called for an exchange rate mechanism to contain euro volatility. "Committed to market-determined rates"? Might as well go back to the gold standard. In the meantime, talk of a coordinated G7 currency policy sent gold scarpering last night, down US$18.90 to US$1649.50/oz, despite a mere 0.1% rise in the US dollar index to 80.36. The Aussie suffered similarly, falling 0.4% to US$1.0273.

Base metals also took heed of a possible end of a global currency race-to-the-bottom and all fell around 1%. Brent crude fell US76c to US$118.13/bbl. West Texas, on the other hand, bucked the trend and jumped US$1.25 to US$95.97/bbl. Goldman Sachs was once again cited as an influence, warning that the widening Brent-WTI spread ignored the likely price impact of the upcoming pipeline connection, which will ease the storage glut at Cushing.

Wall Street did a whole lotta not much last night with no major economic data or corporate earnings releases to provide excitement, and with a lot of market participants still at home trying to dig their way out of their front doors. The Dow continues to sit just under the 14k mark, with little sign of enough impetus to push through. However, with little sign of the impetus for a sell-off at this point either, Wall Street is equally poised to break in either direction depending on whatever piece of news is the catalyst.

Australia's All-Ords managed to reach within three points of 5000 yesterday before the sellers came in. The real focus on Bridge Street is on the more heavily traded ASX 200, which is still forty-odd points shy of what is the true 5000 barrier. The All-Ords is not afforded as much specific attention, but it is still interesting to note the index turned just as it approached the psychological mark.

Having said that, those overnight futures traders seem to be on a lot of red cordial of late, with the SPI Overnight last night closing up 17 points, or 0.3%.

Spot iron ore is again unchanged at US$155.10/t and will probably stay that way this week with the Chinese on holiday.

NAB will release its monthly business conditions and confidence survey today, while Bradken ((BKN)) and Bunnings Warehouse Trust ((BWP)) provide the earnings report highlights.

President Obama will deliver his State of the Union address tonight.