US and European stock markets remained under pressure Monday as investors already fretting over a looming interest rate hike await all-important US inflation numbers later in the week.
Traders have been on edge since the US Federal Reserve signaled last week that it was ready to raise interest rates sooner than expected to tame runaway prices.
"The markets are feeling the pinch of last Friday's jobs report which boosted the hawkish Fed expectations," said market analyst Ipek Ozkardeskaya at Swissquote.
Wall Street stocks appeared headed for another bruising round after a weak morning, but equities recovered somewhat near the end of the day.
The Nasdaq eked out a modest gain, while the Dow and S&P 500 finished modestly lower.
Earlier in Europe, London finished the day down 0.5 percent, while Frankfurt shed 1.1 percent and Paris fell 1.4 percent.
Stock markets had mostly fallen on Friday after US data showed fewer new jobs than expected were created last month even as wages saw strong gains.
With the unemployment rate also falling, many investors looked at the data as an indication employers are having difficulty hiring and wage pressures are building.
Fed officials are now faced with the problem of having to adjust monetary policy to rein in prices while at the same time avoid damaging the economic recovery and causing a panic on markets as the cheap cash that has fueled a near-two year rally dries up.
The yield on 10-year Treasuries, a key indicator of future interest rates, climbed last week at its fastest pace in almost a year.
But on Monday, after climbing above 1.8 percent, yields pulled back somewhat.
The International Monetary Fund warned that emerging economies should prepare for possible rough times as the Fed prepares to hike rates and Covid continues to hit global growth.
Investors will now be keeping a watch on inflation readings out of both the United States and China this week as they try to assess the outlook for the global economy with rocketing energy costs and supply snarls compounding problems caused by the fast-spreading Omicron Covid variant.
Elsewhere, oil prices pulled back amid signs of stabilization in Kazakhstan and as some production resumed in Libya.
- Key figures around 2050 GMT -
New York - DOW: DOWN 0.5 percent at 36,068.87 (close)
New York - S&P 500: DOWN 0.1 percent at 4,670.29 (close)
New York - Nasdaq: UP 0.1 percent at 14,942.83 (close)
London - FTSE 100: DOWN 0.5 percent at 7,445.25 (close)
Frankfurt - DAX: DOWN 1.1 percent at 15,768.27 (close)
Paris - CAC 40: DOWN 1.4 percent at 7,115.77 (close)
EURO STOXX 50: DOWN 1.5 percent at 4,239.52 (close)
Hong Kong - Hang Seng Index: UP 1.1 percent at 23,746.54 (close)
Shanghai - Composite: UP 0.4 percent at 3,593.52 (close)
Tokyo - Nikkei 225: Closed for a holiday
Euro/dollar: DOWN at $1.1337 from $1.1360 late Friday
Pound/dollar: DOWN at $1.3575 from $1.3588
Euro/pound: DOWN at 83.42 pence from 83.61
Dollar/yen: DOWN at 115.20 yen from 115.56 yen
Brent North Sea crude: DOWN 1.1 percent at $80.87 per barrel
West Texas Intermediate: DOWN 0.8 percent at $78.23 per barrel