The three-day trade negotiations between USA and Chinese officials at Beijing concluded on Wednesday, with no significant breakthroughs.
ENERGY: Oil prices fell back after hitting their highest levels in nearly a month. Unemployment is the lowest it's been in decades, wages are rising and consumer confidence is high, while gas prices dropped late past year.
On the supply side, oil markets are receiving support from supply cuts led by the Organization of the Petroleum Exporting Countries and aimed at reining in a glut that emerged in the second half of 2018. Three days of talks between the two biggest economies that concluded on Wednesday.More news: Major League Baseball bending rules for Kyler Murray, Oakland Athletics to reach deal
"Sentiment is greatly improved, and trade talk optimism has helped boost risk-appetite across the week", said Jasper Lawler, head of research at London Capital Group in a note on Friday, although he added that at this stage "there is a lack of anything concrete between the United States and China".
Another driver of bearish sentiment - rising global output and inventories - took a back seat on Friday due to conflicting messages from different sources, ie: while JBC Energy said it was likely that US production was "significantly above 12 million barrels per day [bpd]" by this month, Baker Hughes data showed that USA energy firms this week cut four oil rigs for a second week of declines - an indication that drilling plans are being downsized because of uncertainty over a recovery in crude prices. Data on hedge fund wagers for West Texas Intermediate crude weren't available due to the USA government shutdown. Hong Kong's Hang Seng rose 0.4 percent to 26,633.47. -China trade tensions would slow global economic growth and dampen demand for crude.
The pan-European STOXX 600 benchmark closed up 0.53 percent, its highest close in almost four weeks. Brent, the global benchmark, finished the day up 22% since bottoming out.More news: New England Patriots vs. L.A. Chargers score
Energy Minister Al-Falih said in Riyadh on Wednesday that the 1.2-million-barrel-a-day cut promised by the coalition will be more than sufficient to balance the market.
Crude futures sank along with the ebbing energy stocks in the US stock market as the USA government shutdown has been stretching for three weeks and showed no signs of ending. Kohl's and L Brands also posted disappointing results and a wide variety of retailers plunged as investors anxious that the stock market's December plunge stopped some shoppers from spending as much as they had planned.
"There's a bit of profit-taking in stocks so that helped to rally Treasuries", said Larry Milstein, head of USA government and agency trading at R.W. Pressprich & Co.in NY.More news: Game of Thrones releases new trailer, New Zealand launch date revealed
Meanwhile, dovish commentary by Federal Reserve Chairman Jerome Powell and his deputy Richard Clarida has added to positive investor sentiment. He echoed the tone of other Fed officials who were present at a meeting last month.