Shares began the year mixed, with European benchmarks opening higher on Monday after a lacklustre session for the few Asian markets not closed for New Year holidays.

U.S. markets are also closed.

This week brings employment data and minutes from the latest meeting of the Federal Reserve, as 2023 begins with persisting uncertainties over the war in Ukraine and over the risk that interest rate hikes meant to tame inflation might lead to recession.

Germany’s DAX gained 0.5% in early trading to 13,996.02 and the CAC40 in Paris added 0.7% to 6,520.71. Markets in Britain and in the U.S. are closed Monday in observance of the New Year’s Day holiday.

In Asia, South Korea’s Kospi fell 0.5% to 2,225.67 and the Sensex in Mumbai gained 0.4% to 61,109.23. Jakarta’s benchmark was flat.

Over the weekend, a report showed that Chinese manufacturing contracted for a third consecutive month in December, in the biggest drop since February 2020, as the country grapples with a nationwide COVID-19 surge after suddenly easing anti-epidemic measures.

A monthly purchasing managers’ index declined to 47.0 from 48.0 in November, according to data released from the National Bureau of Statistics on Saturday. Numbers below 50 indicate a contraction in activity.

It’s uncertain what impact removing strict COVID-19 policies that crimped production for raw materials and goods and discouraged travel will have on the global economy.

The specter of recession in the U.S. and other major economies, as well as a prolonged slump in China, are factors overhanging markets.

“We expect one third of the world economy to be in recession,” Kristalina Georgieva, managing director of the International Monetary Fund, said in an interview Sunday with the CBS television network’s “Face the Nation.”

“And yes … even countries that are not in recession, it would feel like recession for hundreds of millions of people,” she said.

Georgieva said, however, that the U.S. economy was “remarkably resilient,” and that measures such as the Inflation Reduction Act and child tax credit measures were “good for the U.S. Good for the world.”

The minutes of the Fed’s meeting potentially will give investors more insight into its next moves. The government will also release its November report on job openings Wednesday. That will be followed by a weekly update on unemployment on Thursday. The closely-watched monthly employment report is due Friday.

Wall Street is also waiting for corporate earnings reports that are due to start flowing in around mid-January. Companies have told investors inflation will likely crimp their profits and revenue in 2023, even after they raised prices on everything from food to clothing to offset inflation, helping to pad their profit margins.

On Friday, U.S. markets logged more losses in quiet trading, closing the book on the worst year for the benchmark S&P 500 since 2008.

The S&P 500 fell 0.3%. It posted a 5.9% loss for the month of December and a 19.4% decline in 2022, or 18.1%, including dividends.

That’s just its third annual decline since the financial crisis of 2008 when the S&P 500 plunged 38.49%, and a painful reversal for investors after the S&P 500 notched a gain of nearly 27% in 2021. All told, the index lost $8.2 trillion in value, according to S&P Dow Jones Indices.

The Dow dropped 0.2% on Friday while the Nasdaq slipped 0.1%. The Russell 2000 shed 0.3%.

Stocks struggled all year as pandemic stimulus was withdrawn and inflation put increasing pressure on consumers while central banks raised interest rates to fight high prices.

The Fed’s key lending rate stood at a range of 0% to 0.25% at the beginning of 2022 and closed the year at a range of 4.25% to 4.5% after seven increases. The U.S. central bank forecasts it will reach a range of 5% to 5.25% by late 2023, with no rate cut before 2024.

Russia’s invasion of Ukraine worsened inflationary pressure earlier in the year by making oil, gas and food commodity prices even more volatile amid existing supply chain issues. Oil closed Friday around $80, about $5 higher than where it started the year. But in between oil jumped above $120, helping energy stocks post the only gain among the 11 sectors in the S&P 500, up 59%.

In currency dealings, the U.S. dollar rose to 130.94 Japanese yen from 130.89 yen. The euro fell to $1.0677 from $1.0699.