By Riva Gold and Akane Otani 
   -- U.S. stocks head for weekly losses 
 
   -- Italian markets slide amid political uncertainty 
 
   -- U.S. government bond yields near multiyear highs 

U.S. stocks showed signs of stalling Friday as bubbling uncertainty around global trade policies and interest rates limited investors' appetite for risk.

The Dow Jones Industrial Average edged up 8 points, or less than 0.1%, to 24722. The S&P 500 declined 0.2%, while the Nasdaq Composite lost 0.2%.

All three stock indexes were headed for small weekly declines, pressured by heavy losses accumulated earlier in the week among shares of utilities and real-estate companies.

Stocks struggled for traction as investors grappled with a range of political risks, including new government proposals in Italy, doubts about a coming meeting between the U.S. and North Korea and continuing trade talks with China.

"There are a few fires at the moment that investors need to take on board," said Olivier Marciot, a multi-asset portfolio manager at Unigestion. "We still don't think it will be material for now, but it will be a strong headwind to equity markets as long as headline risk remains as strong as that."

Major indexes also came under pressure as a rally in crude oil prices and pickup in government bond yields stoked fresh bets on inflation rising.

The yield on the benchmark 10-year U.S. Treasury note wobbled near its highest closing level since 2011, while shares of utilities and real-estate companies in the S&P 500, which are considered bond proxies because of their relatively hefty dividend payouts, both headed for weekly losses of more than 2%.

Meanwhile, U.S. crude futures edged down 0.3%, although they remained up 18% for the year. Rising oil prices helped drive shares of energy companies like Range Resources and Helmerich & Payne up more than 5% this week, although some analysts warn that a prolonged rally in crude could drive inflation higher and cut into corporations' profits.

For now, though, the risks look muted, said Ed Keon, chief investment strategist at investment firm QMA. "We think inflation will probably rise modestly, maybe even a little above the Fed's target, but don't think it will be enough to change the Fed's current course or cause a major problem for stock prices."

One factor that has helped keep many investors optimistic: the fact that data continues to suggest the U.S. economy is expanding at a slow and steady pace, even as reports have pointed to some loss of momentum in Europe and Japan.

Retail sales data Tuesday showed consumers picked up spending at the start of the spring, undeterred by rising gasoline prices. The solid economy has helped retailers like Macy's, whose shares are up 13% for the week following a stronger-than-expected earnings report.

"Everyone is looking for the cloud in the sky, but the outlook is still positive," said JJ Kinahan, chief market strategist at TD Ameritrade.

Elsewhere, Italy's benchmark FTSE MIB index fell 1.5% after two antiestablishment parties seeking to form a governing coalition agreed to scrap or dilute pension reforms that were widely credited with helping keep Italy's finances on a sustainable path.

Stocks more broadly across Europe largely advanced, though, with the Stoxx Europe 600 posting a 0.6% weekly advance.

Recent advances in the U.S. dollar have helped support shares of global multinationals translating revenue into weaker local currencies. The WSJ Dollar Index, which tracks the dollar against a basket of 16 others, extended gains Friday after closing at its highest level since December.

Japan's Nikkei Stock Average rose 0.8% for the week, marking its eighth consecutive weekly advance.

Giovanni Legorano contributed to this article

Write to Riva Gold at riva.gold@wsj.com and Akane Otani at akane.otani@wsj.com

(END) Dow Jones Newswires

May 18, 2018 13:50 ET (17:50 GMT)