Global Markets: Asian shares rose on Friday as China struck a hopeful tone on trade with the United States but continued fears about a global growth slowdown, or even a recession, capped sharp rallies. Investors were focussed on a string of economic releases due over the weekend including China`s official manufacturing survey which would provide a good gauge of the real impact from the Sino-US trade war.

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MSCI`s broadest index of Asia-Pacific shares outside Japan climbed 0.6% but stayed near a recent 7-1/2 month trough. For the week, it is still set for a small weekly loss.  Japan`s Nikkei jumped 1% while South Korea`s KOSPI index gained 1.5% and Australian shares rose 0.9%.

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Overnight, Wall Street added more than 1% after China`s commerce ministry said Beijing and Washington were discussing the next round of face-to-face talks scheduled for September.
 
The comments spurred hopes for progress in the talks and boosted the Chinese yuan, which snapped a 10-day losing streak.

Stock analysts were more circumspect though.

"It`s really hard to say the U.S.-China trade backdrop changed dramatically in the last 12 hours – the Sept 1 tariffs are still going into effect and there are further hikes on the calendar," JPMorgan analysts wrote to clients in a note.

U.S. President Donald Trump said some discussions were taking place on Thursday, with more talks scheduled.

China`s commerce ministry also said a September round of meetings was being discussed by the two sides, but added it was important for Washington to cancel a tariff increase.

"In reality, the headlines are extremely innocuous and don`t differ from what China has said in the past but they crossed during a dead zone of liquidity and attendance and as a result are having an outsized influence on trading," JPMorgan said.

Trade tensions have dominated market sentiment for much of this year with wild swings in world stocks as rhetoric between the United States and China fluctuates from conciliatory to combative.

Last week, China unveiled tit-for-tat tariffs on $75 billion of US goods. In response, US President Donald Trump said he would tack an additional 5% duty onto $550 billion of Chinese goods.
The volatile nature of the negotiations have kept many analysts cautious.

"The recent escalation of the tariff war provides no hopes of a near-term trade deal," ING`s Asia economist Prakash Sakpal wrote.

"As such, we are in for a long stretch of slow growth and increasingly challenging policy environment, as some central bankers have warned."

Even so, US Treasury yields rose overnight with the benchmark 10-year Treasury climbing to 1.535% from a three-year low of 1.443% touched earlier this week.

Among currencies, the dollar was a tad weaker at 98.460 against a basket of six major currencies. It was a shade lower against the Japanese yen at 106.41 after gains overnight while the euro was flat at $1.1053.

Sterling held at $1.218 ahead of a crucial few days for parliament next week which could even result in a no-confidence motion and a new election.

In commodities, spot gold came off recent highs to trade at $1,525.6 an ounce. Silver also eased to $18.16 an ounce after hitting its highest level in more than two years.

U.S. crude slipped 6 cents, or 0.1%, to $56.65 a barrel while Brent was down 10 cents, or 0.2%, at $60.98 a barrel.