BANGKOK (AP) -- Asian stock markets rose Friday, hours before President Barack Obama and key lawmakers were to meet at the White House to try to hammer out an 11th-hour budget compromise to avert the so-called fiscal cliff. Wall Street also appeared set for a session of gains.
Lawmakers have until Monday night to reach a deal before hundreds of billions of dollars in automatic tax increases and deep cuts to government spending kick in. Such a drastic reshuffling of money could throw the U.S. into another recession, economists have warned.
However, failure to avoid the fiscal cliff doesn't necessarily mean tax increases and spending cuts would become permanent, since the new Congress could pass legislation canceling them retroactively after it begins its work next year.
Ahead of the opening bell, Dow Jones industrial futures were marginally higher at 13,005. S&P 500 futures gained nearly 0.1 percent to 1,411.80. European shares were mixed in early trading. Britain's FTSE 100 rose 0.1 percent to 5,959.89. Germany's DAX was nearly flat at 7,653.34. France's CAC-40 shed 0.1 percent to 3.670.03.
The day's market strength was in Asia. Japan's Nikkei 225 index rose 0.7 percent to 10,395.18, its highest level since March 10, 2011, the day that a mammoth earthquake and tsunami pummeled Japan's northeastern cost. Export shares posted big gains as the country's currency continued to recoil against the dollar. Mazda Motor Corp. jumped 4.8 percent and Isuzu Motors Ltd. surged 4.5 percent.
Investors have been cheering newly named Japanese Prime Minister Shinzo Abe and his calls for more public works spending to reinvigorate the economy. He also wants the Bank of Japan to raise its inflation target from 1 to 2 percent to drag the country out of two decades of deflation, or steadily declining prices that have deadened economic activity.
But Francis Lun, managing director of Lyncean Holdings in Hong Kong, said he was skeptical that the new prime minister's roadmap would prove effective in the long run.
"He will increase the deficit, print more money and try to spend out of the recession. If you print or borrow money, you give the economy a sense of false hope," he said. "It's like taking opium. You feel good but eventually you have to come down."
Hong Kong's Hang Seng rose 0.2 percent to 22,666.59, while South Korea's Kospi added 0.5 percent to 1,997.05. Australia's S&P/ASX 200 gained 0.5 percent to 4,671.30.
"The fiscal cliff seems to have lost its negative influence on global markets," said Lun. "Even if it falls into the fiscal cliff, you will only reduce the deficit by about $100 billion. In Chinese terms, it's like trying to douse a fire with a cup of water. They should do what Europe has done and try to impose austerity."
Markets got some lift from optimistic data out of the U.S. on Thursday and a statement from the German finance minister, Wolfgang Schaeuble, who said in an interview that the worst of the debt crisis in the 17 European Union countries that use the euro appears to be over.
In the U.S., the average number of people seeking unemployment benefits over the past month fell to the lowest level since March 2008, a sign that the job market is healing.
Benchmark oil for February delivery rose 24 cents to $91.11 in electronic trading on the New York Mercantile Exchange. The contract fell 11 cents to finish at $90.87 per barrel.
In currencies, the euro fell to $1.3180 from $1.3240 late Thursday in New York. The dollar gained to 86.12 yen from 86.02 yen.
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