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By Swati Pandey
SYDNEY (Reuters) – Asian stocks rose on Friday as China gave an optimistic tone to trade with the United States, but lingering fears of a slowdown in global growth or even a recession , have limited the sharp increases.
Investors focused on a series of economic publications expected this weekend, including China's official manufacturing survey, which would provide a good idea of the real impact of the Canada-US trade war .
MSCIThe largest non-Japan Asia-Pacific equity index rose 0.4%, but remained close to a recent low of 7.5 months. For the week, it is scheduled for a small weekly loss.
Nikkei from Japan <.N225> jumped 1% while South Korea KOSPI index <.KS11> earned 1.3% and Australian stocks <.AXJO> increased by 0.7%.
In one night, Wall Street added more than 1% after the Chinese Ministry of Commerce said Beijing and Washington were discussing the next round of face-to-face talks scheduled for September.
The comments sparked hopes for progress in the talks and boosted the Chinese yuan, ending a series of 10 consecutive losses.
Stock market analysts, however, were more circumspect.
"It's really hard to say that the backdrop of US-China trade has changed dramatically in the last 12 hours – September 1 tariffs are still in effect and there are further increases in calendar", JPMOrgans analysts wrote to customers in a note.
US President Donald Trump said talks were underway on Thursday and more talks were planned.
The Chinese Ministry of Commerce also said that a series of meetings in September was being discussed between the two sides, but added that it was important that Washington cancel a tariff increase.
"In reality, the headlines are extremely harmless and do not differ from what China has said in the past, but they have crossed into a dead zone of liquidity and attendance and therefore have a disproportionate influence on trade" , JPMorgan says.
Trade tensions dominated the market climate for much of this year as global equity prices fluctuated widely, with rhetoric between the United States and China ranging from conciliation to combativeness.
Last week, China unveiled duties equivalent to 75% (61 billion pounds) of goods from the United States. In response, US President Donald Trump said he would add 5% additional rights on $ 550 billion worth of Chinese products.
The volatile nature of the negotiations has kept many analysts cautious.
"The recent escalation of the tariff war does not give hope for a short-term trade agreement", INGPrakash Sakpal, economist for Asia, wrote:
"As such, we have a long period of slow growth and an increasingly difficult political environment, as some central bankers have warned."
Even so, US Treasury yields rose overnight, with the 10-year Reference Treasury rising to 1.535% after a three-year low of 1.443% hit earlier this week.
Among the currencies, the dollar <.DXY> was a bit weaker at 98,422 against a basket of six major currencies. It did not move against the Japanese yen at 106.49 after winning overnight, while the euro <EUR=> was also flat at $ 1,1053.
Sterling <GBP=> s is maintained at $ 1,218 ahead of a few crucial days for Parliament next week, which could even result in a no-confidence motion and new elections.
In raw materials, cash gold <XAU=> has crossed recent highs to trade at $ 1,523.4 an ounce. Silver also reached $ 18.23 an ounce after reaching its highest level in over two years.
US crude slipped 16 cents, or 0.3 percent, to $ 56.55 a barrel.
(Edited by Sam Holmes)
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