Brent crude dropped below $90 a barrel after rising by almost 3% on Friday, while WTI fell toward $84. S&P 500 futures contracts gained 0.3% after the gauge fell 0.5% on Friday, with risk appetite dented over worries including a persistently hawkish Federal Reserve and underwhelming corporate earnings.

The dollar was little changed against major peers, while the 10-year Treasury yield rose more than three basis points. Gold slipped but remained above $2,000 an ounce, and Australian bond yields edged higher.

“As the conflict in the Middle East continues, we are on watch for a collision course between tight financial conditions and geopolitically driven risk aversion,” Eric Robertsen, global head of research and chief strategist at Standard Chartered Plc, wrote in a note to clients. “For the moment, it is rate volatility that is driving outflows from emerging market assets and developed market equities.”

Australian and Japanese equities fell, while shares opened mixed in China. Shares of China Evergrande Group slumped even as the world’s most indebted developer got more breathing room Monday as a Hong Kong court adjourned a winding-up hearing to 4 December. Judge Linda Chan in Hong Kong’s High Court on Monday said “this is really the last adjournment”, the latest in a series of delays since the proceedings began last year.

Shares in Hong Kong traded lower. China’s Bank of Communications dropped as much as 5.8% in Hong Kong after its third-quarter net income declined 3% year on year, while ICBC fell as much as 1% in Hong Kong as analysts saw its earnings results as mixed. 

Meanwhile China’s EV sector delivered some good news, with Great Wall Motor jumping 7.2% in Hong Kong after stronger-than-expected results.

Middle Eastern markets that opened on Sunday showed little sign of panic a day after Israel sent troops and tanks into the northern Gaza Strip. Israel’s TA-35 stock index rose 1.3%, trimming its loss to 11% since the Hamas infiltration on Oct. 7. 

Instead of a massive ground invasion, the Israeli military has started slowly, taking a day-by-day approach based on casualties, concerns of the conflict spreading to Hezbollah in the north and internal political pressures on Prime Minister Benjamin Netanyahu.

“Israel’s ground offensive into Gaza will likely have limited long-term impact on asset markets, unless the conflict were to spread into other regions, such as Iran,” said Spencer Hakimian, founder of hedge fund Tolou Capital Management in New York. 

The global stock market has lost $12-trillion in value since the end of July as concern mounts that central banks’ “higher-for-longer” interest-rate policies may tip the global economy toward a recession.  

The VIX index, known as Wall Street’s fear gauge, has risen to above 21 from around 13 in mid-September, but remains below its mid-20s March highs when the collapse of several regional banks set off a market rout.

The week includes a slew of potentially market-moving events, including central bank meetings in Japan, US and the UK. 

On Wednesday, the US Treasury Department will unveil its quarterly bond sales plan, an announcement that may determine whether the 10-year Treasury yields have the momentum to keep rising after surging to a 16-year high last week. The week will end with the US payroll report that may show job and wage growth slowed last month.