Reuters - Asia stock prices rose Friday as a result of gains on China markets but the mood was cautious owing to a resurgence of coronavirus infections in Europe and the U.S.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.27%. U.S. stock futures gained 0.32%.

Share prices in China rose 0.39% as market participants snapped up banking shares due to an improving earnings outlook.

Australia stock indexes erased early losses to trade even. Japan indexes were 0.05% higher but South Korea lost 0.32%.

Oil futures extended declines in Asia trade as another round of lockdowns to contain the spread of the coronavirus threatens to further weaken world energy demand.

U.S. President Donald Trump's offer Thursday to raise the size of a fiscal stimulus package to win the support of Republicans and Democrats helped narrow Wall Street losses - though many market participants still believe a deal is unlikely before the Nov. 3 election.

"There's a bit of worry there and also at what we're seeing in America and in Europe regarding the virus and how it seems to be taking hold pretty significantly again," said Grant Williamson, investment adviser at Hamilton Hindin Greene in Christchurch, New Zealand.

On Wall Street, the Dow Jones Industrial Average fell 0.07%, the S&P 500 0.15% and the Nasdaq composite dropped 0.47%.

An unexpected rise in U.S. weekly jobless claims figures added to worries about the world economy, especially in the face of a rise in COVID-19 cases in Europe.

The dollar index was at 93.78 - close to a two-week high as signs of a stalling U.S. economy drove safe-haven flows into the dollar.

The one currency that the dollar fell against was the yen - which strengthened 0.15% to 105.31 per dollar given the Japan currency is also seen as safe.

The euro was down 0.01% to $1.1709 while a firmer U.S. dollar dragged on sterling - which was last trading at $1.2900, down 0.12% on the day.

Spot gold was little changed at $1,908.40 an ounce.

The coronavirus outbreak originated in China last year but its aggressive efforts to control the virus mean its economy is recovering faster than others - which suggests an improvement in corporate earnings.

Hong Kong-listed share of Semiconductor International Manufacturing Corp. rose 2.53% Friday after China's top chipmaker raised revenue and gross margin forecasts for the third quarter.

In contrast, many Europe countries have resumed lockdowns and London will enter a tighter COVID-19 lockdown from midnight Friday as Prime Minister Boris Johnson seeks to tackle an accelerating second coronavirus wave.

The European Union put the onus on Britain to compromise on their new economic partnership or stand ready for trade disruptions in fewer than 80 days - another negative for sterling.

The Australian dollar fell 0.2% versus the U.S. unit at $0.7094 - hurt by a decline in commodities.

Oil prices were hurt by concerns about the coronavirus and its effect on the world economy. Brent crude futures fell 0.6% to $42.90 a barrel while U.S. crude futures slipped by 0.44% to $40.77 a barrel.

Traders' preference for safety helped government bonds. The yield on U.S. Treasurys Benchmark 10-year notes held steady at 0.7339% while the two-year yield edged lower to 0.1390%.