Europe seen lower as Swiss abandon cap

European equities are expected to open lower on Thursday as the Swiss National Bank's (SNB) unexpected decision to remove its currency cap unleashes volatility within markets.

Trade could be volatile in Europe Friday following the shock decision by the SNB to abandon a cap placed on the franc's value against the euro. The move surprised European markets on Thursday and caused Swiss stocks to plummet by more than 10 percent at one point.

A stronger currency makes a country's exports – in this case Switzerland, whose businesses include watch maker Swatch and chocolate maker Nestle – more expensive and uncompetitive, potentially damaging the economy. Swiss banks UBS and Credit Suisse and insurers Swiss Re and Zurich Insurance were also hit by the news Thursday.

The Swiss Franc rose to its highest level since January 2011 – soaring nearly 28 percent against the dollar and 30 percent against the euro – after the central bank abandoned the cap on the currency's value of 1.20 francs per euro on Thursday. In Friday's Asian trade, one U.S. dollar bought 0.8698 francs and one euro bought 1.0114 francs.

The Swiss National Bank (SNB) said the cap, introduced in September 2011, was no longer justified. It also cut a key interest rate from -0.25 percent to -0.75 percent, raising the amount investors pay to hold Swiss deposits.

Asked about the SNB's move, International Monetary Fund chief Christine Lagarde told CNBC it was "a bit of a surprise" and had not been warned in advance.

The move unsettled U.S. markets overnight, with stocks falling for a fifth straight session and Asian markets broadly lower on Friday. Shanghai shares outperformed the region, however.

Final euro area inflation data is expected on Friday and corporate results come from Russia's Sberbank, which publishes fourth quarter turnover figures, and France's Carrefour which publishes fourth quarter sales.