By Peter Nurse 

- European stock markets are expected to open higher Friday after Russia and the U.S. agreed to meet next week, raising hopes that the two can reach a diplomatic solution to the Ukraine crisis and avoid conflict.

At 2 AM ET (0700 GMT), the DAX futures contract in Germany traded 0.7% higher, CAC 40 futures in France traded flat and the FTSE 100 futures contract in the U.K. rose 0.2%.

Russian Foreign Minister Sergei Lavrov agreed to meet U.S. Secretary of State Antony Blinken for talks in Europe next week, the State Department said late Thursday.

This follows the ramping up of tensions after both the Ukrainian government forces and Moscow-backed rebels accused each other of breaking cease-fire rules, potentially creating the excuse for Russia to invade.

President Joe Biden warned on Thursday that the probability of an invasion of Ukraine was still “very high.” 

Helping the tone Friday was the news that France's unemployment rate fell in the final quarter of last year to the lowest level since 2008, dropping to 7.4% from 8.0% in the previous three months, better than the expected 7.8%.

Additionally, U.K. retail sales rose 1.9% on the month in January, a jump of 9.1% on the year, as consumers returned to shops after the Omicron surge in late 2021.

In the corporate sector, Renault (PA:RENA) will be in the spotlight after the French auto posted a profit for 2021, beating expectations after two straight years of losses aggravated by the coronavirus pandemic and subsequent chip supply issues weighing on the auto industry.

Sika (SIX:SIKA) posted a hefty jump in full-year net profit and proposed a 16% higher dividend, as the Swiss construction chemicals maker benefited from an upturn in building projects after the pandemic and a raft of acquisitions. 

Norwegian Air (OL:NAS) reported a full-year profit for 2021 after the losses of the previous year, adding that booking trends point to busier travel throughout Europe as Covid restrictions are lifted.

Oil prices slipped lower Friday, heading for a weekly fall, as traders digested the raised prospects of Iranian oil returning to the global market, outweighing the continued tensions on the Ukraine border.

Negotiations to revive Iran’s 2015 nuclear agreement continue to make progress, with a draft accord outlining a sequence of steps that would eventually lead to the removal of oil sanctions on the Persian Gulf country’s crude exports taking shape. Such a deal could result in an additional 1 million barrels a day of oil coming back to the market.

By 2 AM ET, U.S. crude futures traded 0.5% lower at $91.28 a barrel, while the Brent contract fell 0.5% to $92.53. Both contracts were set for their first weekly fall in nine weeks, after hitting their highest levels for over seven years earlier in the week.

Additionally, gold futures fell 0.4% to $1,894.80/oz, while EUR/USD traded 0.1% higher at 1.1371.