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Stocks bounce back on US-China hopes; eyes on US jobs data

Annabelle Liang, Associated Press

A woman walks past an electronic stock board showing Japan's Nikkei 225 index at a securities firm in Tokyo Friday, Jan. 4, 2019. Japanese markets have tumbled as they reopened after the New Year holidays, while other Asian indexes are mixed after a technology-led sell-off on Wall Street. (AP Photo/Eugene Hoshiko)

SINGAPORE (AP) -- Global stocks rose Friday and Wall Street was set to open higher after heavy losses this week, as investors welcomed news of trade talks between the U.S. and China and braced for U.S. jobs data.

European shares recouped losses from a day earlier, with Germany's DAX gaining 1.8 percent to 10,604 and France's CAC 40 rising 1.3 percent to 4,672. Britain's FTSE 100 advanced 1.4 percent to 6,785.

U.S. indexes, which closed broadly lower on Thursday, were set to recover, too. The future contract for the broad S&P 500 index rose 1.4 percent while the Dow future contract climbed 1.3 percent.

"The tide appears to have turned with anticipation for the U.S.-China trade talks commencing next week," Jingyi Pan of IG said in an interview. "Across Asian markets and U.S. futures, there has been an uplifting effect."

China's Commerce Ministry said the talks will be held Monday and Tuesday in Beijing. Officials hope to cool a festering trade dispute that has shaken global financial markets.

Traders are meanwhile keeping an eye on U.S. jobs data and a speech by Federal Reserve Chairman Jerome Powell later Friday.

Economists have forecast that the labor report will show employers added a solid 180,000 jobs last month and that the unemployment rate stayed at a five-decade low of 3.7 percent, according to the financial data firm FactSet. The U.S. jobs market has been one of the bright spots in the world economy in recent years, so investors will be alert to any signs that a global slowdown in growth is affecting the U.S. as well.

Markets fell this week on concerns that consumer spending is weakening in China on goods like iPhones and that trade tensions are hurting global growth.

The U.S. and China have raised tariffs on billions of dollars of each other's goods in a fight over Beijing's technology policy, which Washington alleges is predatory. Last month, President Donald Trump and Chinese leader Xi Jinping agreed to 90-day ceasefire as a step toward diffusing tensions.

Even though the two sides are talking, the global economy faces several stumbling blocks. Growth in China and the eurozone is slowing. Rising interest rates could also weigh on the U.S. economy.

In Asia, Hong Kong's Hang Seng jumped 2.2 percent to 25,626.03. The Shanghai Composite rebounded 2.1 percent to 2,514.87. South Korea's Kospi added 0.8 percent to 2,010.25, while Australia's S&P-ASX 200 lost 0.3 percent to 5,619.40.

Traders cheered a private survey released Friday showing that China's services sector expanded in December at a six-month high. It came on the back of weak Chinese manufacturing data earlier in the week.

Japan's Nikkei 225 index started its first trading day of 2019 by falling more than 3 percent. It closed down 2.3 percent at 19,561.96.

Japanese technology and electronics makers slumped on Apple's report that Chinese iPhone sales were slipping. On Wednesday, Apple CEO Tim Cook told shareholders in a letter that the company expects revenue of $84 billion in the last quarter of 2018, $7 billion less than analysts had forecast.

In other trading, U.S. crude oil added $1.04 to $48.13 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 55 cents on Thursday. Brent crude, used to price international oils, was up $1.31 at $57.26 per barrel after gaining $1.04 the day before.

The dollar strengthened to 108.04 yen from 107.67 yen. The euro rose to $1.1407 from $1.1394.