In European Equity Markets stocks finished Tuesday’s session slightly higher, as investors tried to shrug off concerns surrounding a potential trade war and uncertainty following Italy’s election result. The pan-European STOXX 600 closed up 0.18 percent, off its session lows, with most of the region’s sectors ending flat or in the black. The U.K.’s FTSE 100 gained 0.51 percent by the close, while France’s CAC 40 rose 0.12 percent and Germany’s DAX rose 0.2 percent. In peripheral markets, Italy’s FTSE MIB jumped 1.74 percent. In sector news, autos led the gains, rising more than 2 percent following comments from German automaker Volkswagen, who said that its deliveries rose 5 percent last month.

In Currency Markets the US dollar slipped to a one-week low on Tuesday against a basket of currencies as traders piled back into riskier currencies after an agreement between North and South Korea to hold direct talks. The dollar had already been weakening on worries about a trade war due to U.S. President Donald Trump’s proposed tariffs last week on imported steel and aluminium. Among higher-yielding currencies, the New Zealand dollar was up as much as 1.2 percent on the day and the Aussie up more than 1 percent. Against the yen – traditionally seen as a safe haven, the dollar had slipped as low as 105.86 yen, not far from the 16-month low.

In Commodities Markets oil rose on Tuesday, paring earlier losses after South Korea said it would hold a summit with North Korea for the first time in more than a decade, which investors took as a cue to sell the U.S. dollar and buy risk-sensitive assets such as commodities. The prospect of OPEC and other producers, including Russia, maintaining crude output cuts in the face of a boom in U.S. shale production has helped to push oil back above $65 a barrel this week. Brent crude futures were up 12 cents on the day at $65.66 a barrel, having risen from a session low of $65.30, while U.S. West Texas Intermediate futures were up 3 cents at $62.60, off an earlier high of $63.28 a barrel.

In US Equity Markets stocks opened higher on Tuesday on signs of easing tensions in the Korean Peninsula and mounting pressure against potentially damaging metals tariffs proposed by President Donald Trump. Six of the 11 major S&P sectors were higher, led by gains in the information technology and energy. The S&P 500 gained 0.31 percent to 2,729.28 and the Nasdaq Composite rose 0.42 percent to 7,361.41. Target shares slipped 2.3 percent after the big-box retailer reported lower-than-expected profit for the holiday quarter. Investors are keenly waiting for the upcoming February jobs data due on Friday to gauge the strength of the labor market.

In Bond Markets Euro zone bond yields rose on Tuesday as fears of a global trade war ebbed, taking the shine off safe-haven debt as eyes turned to this week’s ECB meeting for clues as to how and when the bank will withdraw its hefty stimulus programme. Most bond yields across bloc were up 1-2 basis points. Germany’s benchmark 10-year Bund yield was up 2 bps at 0.65 percent, pushing away from five-week lows hit on Monday at around 0.60 percent. Italy’s government bonds steadied after a selloff on Monday, sparked by a surge in support for anti-establishment parties in Sunday’s inconclusive national election. Italy’s 10-year bond yield was steady at around 2.08 percent.