The escalation in hostilities between Washington and Beijing is capping positive sentiment as traders weigh indications of economies healing after lockdowns. U.S. states’ jobless rolls shrank for the first time during the outbreak even as millions more Americans filed for unemployment benefits, while readings on durable goods orders and personal consumption beat forecasts.

“I’m very cautious on my medium and even long-term outlook for the markets,” Kate Jaquet, a portfolio manager at Seafarer Capital Partners LLC, said on Bloomberg TV. “I perceive there to be a very large disconnect between stock-market valuations across the globe and underlying company fundamentals.”

Meantime, clues on the next stages for Federal Reserve policy may come later Friday, when Chairman Jerome Powell participates in a virtual discussion.

The daily fixing of China’s exchange rate on Friday was broadly in line with expectations. The offshore yuan has steadied near a record low after China signaled on Thursday with a stronger-than-expected fixing on Thursday that it wants to avoid rapid depreciation.

Elsewhere, crude oil dipped after gaining Thursday. European stocks ended higher amid optimism over economies reopening and a European Union fiscal stimulus plan.

• Euro-area data due Friday is forecast to show consumer inflation fell to 0.1% in May from 0.4% the previous month.

These are some of the main moves in markets:

Stocks

• S&P 500 futures fell 0.6% as of 10:25 a.m. in Tokyo. The S&P 500 fell 0.2% Thursday.
• Japan’s Topix index fell 0.6%.
• Hong Kong’s Hang Seng retreated 1.5%.
• Shanghai Composite slipped 0.4%.
• South Korea’s Kospi declined 0.9%.
• Australia’s S&P/ASX 200 Index slid 1.2%.

Currencies

• The yen was little changed at 107.51 per dollar.
• The offshore yuan was flat at 7.1719 per dollar.
• The euro bought $1.1079, little changed.

Bonds

• The yield on 10-year Treasuries dipped one basis point to 0.68%.
• Australia’s 10-year yield remained at 0.88%.

Commodities

• West Texas Intermediate crude fell 1.8% to $33.11 a barrel.
• Gold slipped 0.1% to $1,716.91 an ounce.