A gauge of global equities rose and shares on Wall Street set new highs on Friday as investors shrugged off the latest missile test by North Korea, while the dollar eased on unexpected weak economic data that dimmed the likelihood for a U.S. rate hike.
Brent oil prices, the global benchmark, held near five-month highs and were on track for the biggest weekly gain since late July. Forecasts for rising demand and the gradual restart of U.S. oil refineries after Hurricane Harvey pushed up prices.
Gold fell after a European Central Bank official called for scaling back the bank's stimulus program. Losses were capped when weaker-than-expected U.S. retail sales renewed doubts the Federal Reserve will raise rates in December.
Yields on longer-dated U.S. Treasury maturities briefly added to earlier declines after the weak data revived some concerns about slower economic growth in the third quarter and the possibility of a Fed rate hike.
Interest rates are lower than at the beginning of the year which makes stocks more attractive, as does a back-drop of a growing global economy, said Rahul Shah, chief executive of Ideal Asset Management in New York.
"We made it through the summer without a significant correction. As we head into earnings season, there's a potential for the market to go even higher," Shah said.
Some of the big tech companies that form a large part of the indexes offer above-average growth at reasonable valuations, he said. Any dip in the equity market because of North Korean missile tests offer investors a buying opportunity, he said.
"They tend to talk loud with their threats," Shah said about North Korea. "But in terms of the actual commission of those threats, I don't think it's destabilising to the market."
Japan's Nikkei closed 0.5 per cent higher and a more than 3 per cent jump for the week was its weekly performance since November
MSCI's gauge of stocks across the globe gained 0.11 per cent to set a new high for an index that tracks the performance of more than 2,400 stocks in 47 countries.
On Wall Street, the Dow Jones Industrial Average rose 55.74 points, or 0.25 per cent, to 22,259.22. The S&P 500 gained 1.7 points, or 0.07 per cent, to 2,497.32 and the Nasdaq Composite added 16.33 points, or 0.25 percent, to 6,445.42.
The pan-European FTSEurofirst 300 index of leading regional shares lost 0.41 per cent to close at 1,495.38.
U.S. retail sales unexpectedly fell in August as Hurricane Harvey likely depressed motor vehicle purchases, dropping 0.2 per cent last month. Economists polled by Reuters had forecast retail sales nudging up 0.1 per cent.
The disappointing U.S. data, which included industrial output in August, came after a report that showed the strongest increase in consumer prices in seven months.
Benchmark 10-year U.S. Treasury notes fell 1/32 in price to yield 2.2023 per cent.
A eurozone government bond selloff resumed after hawkish rhetoric from a Bank of England policymaker bolstered the notion that central banks across the developed world are moving into tightening mode.
German Bunds last fell 1 basis points in price to yield 0.433 per cent, up from 0.437 per cent late on Thursday.
Brent oil prices, the global benchmark, held near five-month highs and posted their biggest weekly gain since late July.
U.S. crude settled unchanged at US$49.89 per barrel and Brent rose 15 cents to settle at US$55.51 a barrel.
The dollar index fell 0.23 per cent, while the euro rose 0.15 per cent to US$1.1936. The Japanese yen weakened 0.62 per cent versus the greenback at 110.91 per US$1, and sterling last traded at US$1.3567, up 1.28 per cent on the day.
U.S. gold futures fell 0.16 per cent to US$1,327.20 an ounce.