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European Shares Seen Up On Hopes For US-China Trade Talks


European stocks may open higher on Friday, although a softer dollar after the release of weaker-than-expected U.S. inflation data as well as mixed readings on the Chinese economy may limit overall upside.

Asian markets remain broadly higher, with news of a possible new round of U.S.-China trade talks in coming days and easing concerns about the state of emerging markets helping underpin investor sentiment.

While Chinese stocks fluctuated amid lingering uncertainty over the outlook for trade, markets elsewhere across the region followed their U.S. peers higher.

Chinese industrial output and retail sales figures for August topped forecasts, but real estate investment cooled and growth in fixed asset investment dipped to a historic low, raising risks to China's economic outlook as the trade conflict with the U.S. escalates.

Chinese officials have welcomed an invitation from U.S Treasury Secretary Steven Mnuchin for new talks. However, U.S. President Donald Trump tempered market expectations, tweeting the U.S. is "under no pressure to make a deal with China."

Two-third of American companies in China said they have been hurt by the initial $50 billion in tariffs rolled out by the United States and China.

The Trump administration is readying tariffs on another $200 billion worth of Chinese goods, a move that many fear could escalate the conflict between the world's two largest economies.

Gold prices edged higher as the dollar index hovered near a six-week low hit on Thursday. Oil clawed back some losses in Asian trade after prices fell the most in a month on Thursday.

Brent crude futures fell 2 percent on Thursday and U.S. light crude futures tumbled around 2.5 percent after the International Energy Agency warned of mounting economic risks.

Overnight, U.S. stocks posted solid gains as investors cheered news of fresh U.S.-China trade talks in the near future and tepid inflation data.

Sentiment was also aided by a recovery in Turkey and other emerging markets after the Turkish central bank raised interest rates sharply in a bid to boost the lira.

The Dow Jones Industrial Average rose 0.6 percent, the tech-heavy Nasdaq Composite climbed 0.8 percent and the S&P 500 added half a percent.

European markets ended Thursday's session with mixed results as the euro and pound strengthened against a broadly weaker dollar.

Investors also digested policy statements from both the European Central Bank and the Bank of England, with both keeping interest rates on hold.

The pan-European Stoxx Europe 600 index eased 0.2 percent. The German DAX rose 0.2 percent, while France's CAC 40 index edged down 0.1 percent and the U.K.'s FTSE 100 dropped 0.4 percent.

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