President Trump kept up pressure on trading partners over the weekend, threatening European automakers with a tax on imports if the EU retaliates against his plan to slap tariffs on metal imports. Canada, the biggest supplier of steel and aluminum to the U.S., also said it would retaliate if hit by the tariffs, while China declared it would defend its interests. U.S. stock index futures are mixed to start the week as fears of a trade war rumble on.

Economy

The euro traded choppily around the $1.23 level overnight as elections propelled the eurosceptic 5-Star Movement to become Italy's largest single party, but no faction was projected to gain a majority of seats in parliament. Support for the currency was also seen after Germany's Social Democrats backed the renewal of an alliance with Angela Merkel's conservatives, reviving the grand coalition after months of political uncertainty.

A survey closely monitored by the ECB indicated that the eurozone economy hit a slight "speed bump" in February as the central bank looks to end its ultra-easy monetary policy. The bloc's final composite PMI fell to 57.1 from January's 58.8, but remained way above the 50 level that indicates expansion. It's "too early to read too much" into the monthly decline, said Chris Williamson, chief economist at IHS Markit.

A South Korean delegation has left for North Korea, aiming to bring Pyongyang and Washington together for talks in a bid to rein in Kim Jong-un's nuclear and missile programs. Over the weekend, Iran also announced it wouldn't negotiate over its ballistic missiles until the U.S. and Europe dismantle their own nuclear weapons, keeping up the Islamic Republic's tough stance on the issue.

China's National People's Congress has officially kicked off with over 3,000 lawmakers descending on Beijing, where the country's rubber-stamp parliament is expected to eliminate the two-term limit for the presidency. Continuing a campaign to reduce risks in China's financial system, Premier Li Keqiang also set a target for economic growth for 2018 at "about 6.5%," a slight recalibration from last year's objective of "around 6.5% or higher if possible."

Amid tensions between the nations, Russia's Gazprom (OTCPK:OGZPY) is canceling its contracts to supply Ukraine with natural gas after a Stockholm arbitration court ordered it to pay more than $2.5B to Naftogaz. Russia's energy ministry said the move poses no immediate threat of natural gas to Europe, but Ukraine's government warned that it could use the supplies as a political weapon.

"The U.S. is set to put its stamp on global oil markets for the next five years," the IEA said in its latest monthly report. Beyond that, however, the agency warned that oil supply could become tight unless investment in new production rebounds from historic declines in recent years. The forecast kick-starts the annual CERAWeek conference, a gathering of thousands of oil executives, traders, bankers and investors in Houston.

Stocks

The U.S. Committee on Foreign Investment has ordered Qualcomm (NASDAQ:QCOM) to delay tomorrow's upcoming shareholder meeting by a month as it investigates whether a proposed takeover by a Singapore-based Broadcom (NASDAQ:AVGO) would put national security at risk. The intervention comes as Qualcomm shareholders were set to vote on whether to replace six of its directors with candidates put forward by Broadcom, which is seeking to force a $142B takeover. QCOM -2.3% premarket.

The EU will unveil plans this month to tax large global tech companies' revenue at a rate in the 2% to 6% range, French Finance Minister Bruno Le Maire told Le Journal du Dimanche. The proposal aims at increasing the tax bill of firms like Amazon (NASDAQ:AMZN), Google (GOOG, GOOGL) and Facebook (NASDAQ:FB), which are accused of rerouting their EU profits to low-tax countries such as Luxembourg and Ireland.

"We've always been considering entering the U.S. market," Xiaomi (Private:XI) Chairman Lei Jun said at the sidelines of China's annual legislative session in Beijing. "We plan to start entering the market by end 2018, or by early 2019." The move would extend the Chinese smartphone maker's Western expansion as it plans a highly anticipated IPO that would likely raise at least $10B in the second half of this year.

Walmart will start offering prepared meals at its stores for the first time, a move that could boost the nation's biggest grocer following Amazon's (AMZN) $13.7B purchase of Whole Foods. Ten different meals are now available in 250 stores, and the program will expand to 2,000 locations by year's end. Prices of Walmart's (NYSE:WMT) prepared meals will range from $8 to $10.

In a deal that would make Europe's second-largest insurer a world leader in the property and casualty market, AXA (OTCQX:AXAHY) has agreed to buy Bermuda-based XL Group (NYSE:XL) for around $15.3B. Under the terms of the transaction, XL Group shareholders will receive $57.60 per share, representing a premium of 33% to XL's closing share price on March 2. XL +30.5% premarket.

Fantastical romance The Shape of Water won the Oscar for Best Picture on Sunday, with Guillermo del Toro claiming the honor for best director. Other winners: Gary Oldman was named best actor for playing Winston Churchill in Darkest Hour (NYSE:TWX), while Frances McDormand claimed the award for best actress in Three Billboards Outside Ebbing, Missouri (NASDAQ:FOXA).

Several big brands are once again beating a hasty YouTube (GOOG, GOOGL) retreat. Nike (NYSE:NKE), 20th Century Fox (FOXA), Expedia (NASDAQ:EXPE), Alibaba (NYSE:BABA) and Wix.com (NASDAQ:WIX) have suspended ads from InfoWars' channels after their commercials were streamed on the network's videos. YouTube ad campaigns don't necessarily permit firms to know where their commercials will show up but do allow organizations to use exclusion filters.

Almost 2,500 workers at General Motors' (NYSE:GM) South Korean unit, equivalent to 15% of its staff, have applied for a redundancy package that the automaker is offering as part of a major restructuring. GM said last month it would close down one plant and decide on the fate of three others in the coming weeks - decisions that hang on financial support and concessions from Seoul and local unions.

A U.S. judge has dismissed a lawsuit filed by institutional investors who purchased bonds from Volkswagen's (OTCPK:VLKAY) U.S. unit and claimed the automaker had made false and misleading statements before Dieselgate. In other news, VW reportedly intends to change the legal structure of its trucks business this month as a first step towards an IPO of the division.

The Florida Senate has rejected a proposal to ban assault weapons, and voted for a measure to arm some teachers, weeks after 17 people were killed in the deadliest high school shooting in U.S. history. The bill also raised the minimum age to buy a rifle or a shotgun to 21 from 18, banned the use of bump stocks and included $400M in funding for schools to address mental health issues. Related tickers: AOBC, RGR

Today's Markets

In Asia, Japan -0.7%. Hong Kong -2.3%. China +0.1%. India -0.9%.
In Europe, at midday, London +0.2%. Paris +0.3%. Frankfurt +0.3%.
Futures at 6:20, Dow -0.1%. S&P -0.1%. Nasdaq +0.2%. Crude +0.2% to $61.39. Gold +0.2% to $1325.60. Bitcoin +0.3% to $11513.
Ten-year Treasury Yield flat at 2.85%

Today's Economic Calendar

9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
12:30 PM TD Ameritrade IMX