European shares dropped the most since a global rout three weeks ago following sharp declines in the U.S. and Asia. Treasury yields fell to a two-week low as traders awaited a second appearance from Federal Reserve Chairman Jerome Powell, whose comments riled markets earlier this week.

S&P 500 Index futures signaled the underlying gauge will extend its worst monthly loss in two years at the open. Retailers and media companies were among the biggest losers in the Stocks Europe 600 Index as some earnings missed estimates and manufacturing data showed mounting signs growth momentum may have peaked. Spot gold headed for the lowest close this year and the dollar advanced.

Traders are on edge ahead of Powell’s second day of testimony after he painted an upbeat picture of the U.S. economy on Tuesday. His comments opened the door to speculation that the central bank plans to quicken the pace of monetary tightening, a move investors like Bridgewater Associates Inc. President Ray Dalio warn could hamper growth.

Elsewhere, the U.K. pound extended a decline after the European Union published a draft Brexit treaty, squaring off with Prime Minister Theresa May. The Australian dollar dropped after business investment unexpectedly fell in the final three months of last year.

Aluminum headed lower with President Donald Trump set to announce steep import tariffs on Thursday. West Texas Intermediate crude retreated for a third day.

Here are some key events scheduled for this week:

Fed’s Powell testifies before the Senate Banking Committee Thursday. Other Fed speakers this week are Bill Dudley. Russian President Vladimir Putin is giving a pre-election address in Moscow. U.K. Prime Minister Theresa May delivers a speech Friday on Britain’s relationship with the European Union.
These are the main moves in markets:

Stocks

The Stoxx Europe 600 Index fell 1.1 percent as of 10:23 a.m. London time, the lowest in more than two weeks on the biggest fall in almost three weeks. The MSCI All-Country World Index fell 0.4 percent to the lowest in more than two weeks. Futures on the S&P 500 Index declined 0.4 percent to the lowest in more than a week. The U.K.’s FTSE 100 Index decreased 0.6 percent to the lowest in more than two weeks.

Currencies

The Bloomberg Dollar Spot Index increased 0.1 percent to the highest in almost seven weeks. The euro declined less than 0.05 percent to $1.2189, the weakest in six weeks. The Australian dollar dipped 0.6 percent to 0.772 per dollar, the weakest in almost 10 weeks. South Africa’s rand sank 0.9 percent to 11.9027 per dollar, the weakest in more than two weeks. The British pound fell 0.1 percent to $1.3745, the weakest in almost seven weeks.

Bonds

The yield on 10-year Treasuries decreased three basis points to 2.84 percent, the lowest in more than two weeks. Germany’s 10-year yield declined two basis points to 0.63 percent, the lowest in almost five weeks. Britain’s 10-year yield decreased four basis points to 1.501 percent, the lowest in a month.

Commodities

West Texas Intermediate crude dipped 0.6 percent to $61.28 a barrel, the lowest in two weeks. Gold fell 0.5 percent to $1,311.33 an ounce, the weakest in two months. LME aluminum declined 0.4 percent to $2,124.50 per metric ton, the lowest in almost three weeks. — Bloomberg

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