Investor nerves remained on show across global stock markets Monday amid continued fretting about the potential for a full-fledged trade war. The dollar strengthened against most major peers and Treasury yields dropped, while the euro weakened as Italy headed toward a hung parliament.

European shares eked out gains following four days of losses, but equity gauges from Tokyo to Sydney slumped during the Asian trading session. The Stoxx Europe 600 Index got a helping hand from the euro, which weakened as Italy’s anti-establishment political groups surged in Sunday’s election. Italian stocks and bonds both slid. Amid worries about the implications of U.S. tariffs for the world’s economy, Germany’s breakthrough toward agreeing on a government did little for the common currency. Shares in Shanghai bucked the regional declines as China kept its 2018 growth target of around 6.5 percent.

The Italian election result and Germany’s move toward a coalition kick off a busy week for macro events. Both the Bank of Japan and European Central Bank will meet to decide on interest rate policy, while China hosts its National People’s Congress. Overshadowing it all, however, will be the next developments on global trade after U.S. President Donald Trump riled markets with his proposed tariffs last week.

There’s a “lot of politics this week with Italy elections and NPC in China, also trade measures,” Frank Benzimra, head of Asia equity strategy at Societe Generale SA in Hong Kong, said. “The return of volatility we have seen since the end of January will probably remain.”

Elsewhere, oil climbed as geopolitical risk resurfaced, with a halt at Libya’s biggest crude field sparking speculation that supply will tighten and help reduce a global glut. Bitcoin advanced for a third day.

Here are some key events coming up this week:

The Chinese People’s Political Consultative Conference runs through March 15 and overlaps with the National People’s Congress meetings in Beijing, through March 20. The Bank of Japan deputy governors’ confirmation hearings will be held Monday. Reserve Bank of Australia monetary policy decision on Tuesday, with GDP data due Wednesday. The ECB isn’t expected to change policy on Thursday, but the Governing Council may discuss a change to pave the way for the end of quantitative easing. BOJ monetary policy decision and briefing on Friday. U.S. monthly payrolls data.

These are the main moves in markets:

Stocks

The Stoxx Europe 600 Index climbed 0.3 percent as of 8:19 a.m. London time, the first advance in a week. The MSCI World Index of developed countries fell 0.1 percent on its fifth consecutive decline. The MSCI Asia Pacific Index sank 1 percent with its fifth straight decline. Japan’s Nikkei 225 Stock Average sank 0.7 percent to the lowest in more than 20 weeks. The MSCI Emerging Market Index fell 0.8 percent with its fifth consecutive decline. The U.K.’s FTSE 100 Index increased 0.4 percent, the first advance in a week. Futures on the S&P 500 Index declined 0.5 percent to the lowest in almost three weeks.
Currencies

The Bloomberg Dollar Spot Index increased 0.2 percent. The euro fell 0.1 percent to $1.2302. The British pound decreased 0.1 percent to $1.3783. The Japanese yen gained 0.2 percent to 105.49 per dollar, the strongest in about 16 months.
Bonds

The yield on 10-year Treasuries fell three basis points to 2.83 percent. Germany’s 10-year yield declined four basis points to 0.61 percent, the lowest in more than five weeks. Britain’s 10-year yield decreased three basis points to 1.474 percent, the lowest in more than five weeks.
Commodities

West Texas Intermediate crude increased 0.7 percent to $61.66 a barrel, the largest climb in more than a week. Gold advanced 0.3 percent to $1,326.94 an ounce, the highest in a week. — Bloomberg

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