Investors optimistic on trade talks

Europe’s markets were positive on Friday, after investor optimism from U.S.-China trade talks spread through the indexes.

The Stoxx Europe 600 gained 0.2%, after finishing down 0.3% on Thursday. Italy’s FTSE MIB index was the regions top climber. Meanwhile the rest of Europe’s major indexes added around 0.3% on Friday, with the German DAX rising 0.6%, the FTSE 100 jumping 0.6% and France’s CAC 40 rising 0.4%.

As this week’s trade talks between the U.S. and China come to a close, investors are optimistic about progress, with President Donald Trump reportedly set to meet with China’s top trade negotiator on Friday. Although negotiations appear to be moving forward, officials from both sides have reportedly struggled to agree on specific language as they develop the framework of a potential trade deal.

Germany’s economy narrowly missed falling into recession in the final quarter of last year, official data from the Office of National Statistics showed on Friday. Higher state spending and booming construction prevented the Europe’s largest economy from slumping.

However, the Ifo Institute announced on Friday Germany’s business sentiment had dropped to a four-year low in February, a sign the slowdown felt in the second half of 2018 has continued into 2019.

The final eurozone CPI reading for January inflation, is “expected to show that headline inflation fell further from 1.6% to 1.4%, with core prices set to stay unchanged at 1.1%,” according to Michael Hewson, chief market analyst at CMC Markets UK.

Shares in Asia recouped early losses on Friday, buoyed by strong gains in China as signs of progress in trade talks with the United States offset worries about a deteriorating global economic outlook.

MSCI's broadest index of Asia-Pacific shares outside Japan was 0.3 percent higher by mid-afternoon, having spent the day dipping in and out of negative territory.