Volkswacht Bodensee - Stocks up, oil down on Mideast deal hopes

Iran's position remained unclear however, with foreign ministry spokesman Esmaeil Baqaei saying Tehran "had not reached a final conclusion on the agreement".

He added that "most of the text of the agreement was finalized, but the problem began when the US side made new demands and changed its positions".

The mood on equity markets was also buoyant ahead of the market debut later Friday of Elon Musk's SpaceX, the biggest initial public offering in history.

The $75-billion share sale puts SpaceX among Wall Street's 10 biggest companies with a valuation of just under $1.8 trillion -- ahead of Tesla, Facebook owner Meta, and Walmart.

On Thursday Wall Street had rallied and oil prices tumbled after Trump's comments, with the broad-based S&P 500 ending up 1.8 percent.

"Donald Trump's rhetoric flipped intraday from strike risk and hard military language toward no immediate attack, high-level diplomacy with Iran and talk of a deal being close enough to sign as soon as this weekend in Europe, with Vice President JD Vance expected to attend," said Stephen Innes at SPI Asset Management.

The European Central Bank raised interest rates on Thursday for the first time since 2023, after the Iran war sent oil and gas prices soaring.

Markets see a rising chance that the Federal Reserve will also increase US interest rates. The Bank of Japan (BoJ) meets next week.

"(With) inflation pressures continuing to build, there will almost certainly still be a majority in favour of a (BoJ) rate hike," said Abhijit Surya at Capital Economics.

The Nikkei on Friday closed up almost three percent while Seoul's chip-heavy Kospi gave back earlier gains to end the day 4.6 percent higher. The Hang Seng and Shanghai also rallied.

In early trade, the CAC 40 in Paris was up 1.6 percent, the DAX 30 in Frankfurt added 1.4 percent and London's FTSE firmed by just under one percent.

Brent crude and West Texas Intermediate were down by more than two percent.

- Key figures around 0750 GMT -

Tokyo - Nikkei 225: UP 2.81 percent at 66,020.04 (close)

Hong Kong - Hang Seng Index: UP 1.42 percent at 24,593.83

Shanghai - Composite: UP 1.12 percent at 4,031.51

London - FTSE 100: UP 0.88 percent at 10,394.93

Euro/dollar: DOWN at $1.1559 from $1.1579 on Thursday

Pound/dollar: DOWN at $1.3386 from $1.3418

Dollar/yen: UP at 160.36 yen from 159.78 yen

Euro/pound: UP at 86.35 pence from 86.29 pence

Brent North Sea Crude: DOWN 2.53 percent at $88.09 a barrel

West Texas Intermediate: DOWN 2.45 percent at $85.56 a barrel

T.Germann--VB