NEW YORK (AP) — U.S. markets were poised to open sharply lower on Monday as interest rate hikes and a slowing Chinese economy weigh on investor sentiment.

Dow Jones Industrial futures declined 1.6% and the S&P 500 fell 2%. European shares dipped in midday trading and Asian benchmarks finished lower.

A turbulent week on Wall Street ended Friday with more losses and the stock market’s fifth straight weekly decline. The pullback came as investors balanced a strong U.S. jobs report against worries the Federal Reserve may cause a recession in its drive to halt inflation.

The Fed is hoping to raise rates and slow the economy enough to snuff out the highest inflation in four decades, but it risks choking off growth if it goes too far or too quickly.

China reported its exports rose 3.7% over a year earlier in April to $273.6 billion, down sharply from March’s 15.7% growth, as global demand weakened. That added to pressure on the world’s second-largest economy after Shanghai and other industrial cities were shut down to fight virus outbreaks.

Imports crept up 0.7% in April to $222.5 billion, in line with the previous month’s sub-1% growth.

Companies and investors worry the ruling Communist Party’s “zero-COVID” strategy that temporarily closed most businesses in Shanghai and other industrial centers is disrupting global trade and activity in autos, electronics and other industries.

But a slowing global economy is also taking a toll.

“The blame rests partly with China’s COVID-19 outbreak, which has led to manpower shortages and bottlenecks in the logistics sector. But the extent of these disruptions shouldn’t be overplayed,” Julian Evans-Pritchard said in a commentary. “Instead, the drop in exports seems to mostly reflect softer demand.”

The Shanghai Composite was little changed, adding nearly 0.1% to 3,004.14. Markets were closed in Hong Kong for a national holiday.

Japan’s benchmark Nikkei 225 lost 2.5% to finish at 26,319.34. South Korea’s Kospi dipped 1.3% to 2,610.81. Australia’s S&P/ASX 200 dropped 1.2% to 7,120.70. The benchmark in Jakarta, Indonesia, lost 4.4% as markets reopened after the Eid al-Fitr holiday last week.

In Europe, France’s CAC 40 slipped 2.1% in midday trading, Germany’s DAX fell 1.8% and Britain’s FTSE 100 was down 1.9%.

Apart from concerns about inflation and coronavirus restrictions, the war in Ukraine is still a major cause for uncertainty. More than 60 people were feared dead after a Russian bomb flattened a school being used as a shelter, Ukrainian officials said. Moscow’s forces pressed their attack on defenders inside Mariupol’s steel plant in an apparent race to capture the city ahead of Russia’s Victory Day holiday Monday.

“Russia’s Victory Day today will also bring geopolitical risks back into the limelight as well. President Putin is likely to reiterate his justification for the Ukraine war, but markets may be watching for any further efforts to ramp up military operations to secure the war,” said Yeap Jun Rong, market strategist at IG in Singapore.

Even the energy sector, a star performer in recent weeks, is under pressure Monday. Benchmark U.S. crude fell $2.88 to $106.89 a barrel in electronic trading on the New York Mercantile Exchange, but is still up more than 40% this year. Brent crude, the basis for pricing oil for international trading, edged down $2.74 to $109.65 a barrel.

In currency trading, the U.S. dollar rose to 131.06 Japanese yen from 130.55 yen. The euro cost $1.0540, down from $1.0545.