Markets up, oil eases as Trump's Syria strike threat subsides
Asian markets mostly rose on Friday as Donald Trump soothed concerns about military action in Syria while also sparking hopes the US could re-join a massive Pacific-wide free-trade pact.
The US president on Wednesday sent shudders across trading floors when he warned "missiles will be coming" to Syria in response to an alleged chemical attack by the Russia-backed regime, fuelling fears of a stand-off between the major powers.
He tempered the rhetoric a day later suggesting he might hold off on an imminent strike while he holds talks with France and Britain on how to deal with the crisis.
As investors digested the remarks, it emerged Trump had directed senior aides to explore re-joining the Trans-Pacific Partnership (TPP), which he left on becoming president, calling it a US jobs killer.
The U-turn came as he suggested the US and China might not eventually impose tariffs on each other's goods, despite recent tit-for-tat warnings over hundreds of billions of dollars of trade.
That followed Chinese President Xi Jinping's conciliatory speech this week promising to open up his country's economy.
The developments have provided a huge lift to markets, which were sent into turmoil when Trump last Friday threatened fresh tariffs on a vast array of Chinese imports, fanning fears of a trade war between the world's top two economic powers.
Trump also said Thursday the review of a trade pact with Canada and Mexico was "coming along great".
'Back from the brink'
"Remarkable. That's the only thing I can really say in the past 36 hours or so about the change in tone that seems to be emanating from the president and the White House," said Greg McKenna, chief market strategist at AxiTrader.
"President Trump is walking back from the brink on so many fronts it's making my head spin," he added.
"It's becoming clear his tweets are part of an anchoring approach he uses in negotiations and then eases away from to achieve what he wants. It's working on many fronts and he's eased back on China and Russia/Syria this week and there was news last night he's even reconsidering the TPP."
All three main indexes in New York ended sharply higher.
Oil prices edged lower on Friday after US President Donald Trump tempered remarks warning of an imminent missile attack on Syria, but were still set for their biggest weekly gains in more than eight months.
They surged to their highest since late 2014 on Wednesday after Trump warned that missiles "will be coming" in response to the attack in Syria and Saudi Arabia said it intercepted missiles over Riyadh.
London Brent crude LCOc1 was down 18 cents, or 0.2 percent, at $71.84, and is up about 7 percent for the week.
Both benchmarks, which have risen about $5 this week, are set for their biggest weekly gains since last July.
"This last jump of $5 or so is because of the geopolitical situation caused by the situation in Syria," Tony Nunan, senior oil risk manager at Mitsubishi Corp in Tokyo, told Reuters.
"It looks like Trump backed off a little bit. That's not to say that we can't go up just based on fundamentals because the market supply-demand is tight."
Western powers continued to weigh their options on Friday over possible strikes against Syria's regime as pressure built to avoid an escalation following a warning from Russia that military action could lead to "war".
The UN Security Council was to meet again Friday, at Russia's request, to try to defuse the standoff, as US President Donald Trump appeared to back away from imminent action.