Shanghai — Most Asian share markets rose on Friday, heartened by gains on Wall Street fuelled by the expectation of strong US earnings, but China’s markets wobbled as investors braced for the impact of broadening, tit-for-tat Chinese-US tariffs.

Adding to the fear that even stronger punitive measures from Washington may be on the way, China reported a trade surplus with the US of $28.97bn in June, the highest on record, according to Reuters calculations.

China’s overall global export growth topped expectations, however, possibly as its exporters and big American customers rushed to beat US tariffs.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.6%, adding to a 0.6% rise on Thursday, after US stocks ended the day higher.

The MSCI index rose on gains in Taiwan shares, which rose 0.8%, Seoul’s Kospi, which added 1%, and Hong Kong’s Hang Seng index, which was 0.5% higher.

Australian shares turned lower, falling 0.2% after adding 0.8% Thursday. Japan’s Nikkei stock index was 1.3% higher.

In China, the blue-chip CSI300 index was up 0.1% after dipping into the red, and the Shanghai Composite index was 0.4% lower. There was little immediate reaction in Chinese markets to the trade data.

Shares in Asia have been see-sawing as investors ponder the impact of Washington’s planned 10% tariffs on an additional $200bn in Chinese imports.

The US slapped import tariffs of 25% on $34bn worth of Chinese goods on July 6, prompting a matching response from China.

While China has vowed to retaliate to the new tariffs, the lack of a specific response to date has sparked global relief, helped by expectations of strong corporate earnings.

On Friday, S&P500 e-mini futures rose to a five-month high on the expectation of solid earnings growth among US firms despite the trade war threat.

Analysts are forecasting that S&P 500 companies’ earnings grew about 21% in the second quarter from a year earlier, according to Thomson Reuters data.

Greg McKenna, chief market strategist at Axi Trader in Sydney, said that a good earnings season could nevertheless bring with it some "troubling outlooks".

"If you recall what happened when the CFO [chief financial officer] of Caterpillar said last earnings season that [the first quarter] was likely to be the high water mark. All we need is somebody with serious exposure to the global economy to do something similar and we’re talking about the downside again for stocks, not the upside," he said.

Renewed talks?

Offering some reassurance to investors spooked by trade war concerns, US Treasury Secretary Steven Mnuchin said on Thursday that the US and China could reopen trade talks, but only if Beijing was willing "to make serious efforts to make structural changes".

"Some have suggested that Chinese officials are easing back their rhetoric with the intention of going back to the negotiation table, perhaps in light of increased concerns about economic impacts," ANZ analysts wrote in a note on Friday.

"But it is not clear whether it is truly a change in tone or if the US news was a surprise to China’s economic team and a reaction is being prepared."

The dollar, which has been a safe-haven amid global uncertainty over trade, touched ¥112.70 against the yen, its highest level since January 10, boosted by the expectation of higher US inflation. At 3.05am GMT, it was flat on the day at ¥112.58.

The dollar index, which tracks the greenback against a basket of six major rivals, was up less than 0.1% at 94.846. The euro was down a hair at $1.1667.

In commodities, US crude crept down to $70.30 a barrel.

Brent crude gave up more ground, falling 0.5% to $74.10 a barrel. Brent prices had risen on Thursday after a warning from the International Energy Agency about the world’s stretched oil supply cushion drove concerns about spare capacity.

The warning came after supply disruptions in recent weeks from countries including Venezuela, Norway, Canada and Libya.

Spot gold was flat, trading at $1246.58/oz.