U.S. stock index futures were higher Friday morning, building on gains in the previous session as the world’s two largest economies neared the signing of a so-called phase one trade deal in principle.

Around 7 a.m. ET, Dow Jones industrial average futures indicated were up 115 points, indicating a gain of 90 points at the open. S&P 500 and Nasdaq 100 futures also pointed to a positive start to the final trading session of the week.

The Dow jumped more than 200 points while the S&P 500 closed 0.9% higher on Thursday. The Nasdaq Composite ended the day up 0.7%. All three touched record highs on Thursday.

Wall Street was already headed for solid weekly gains in anticipation of a deal ahead of the Sunday tariff deadline. The S&P 500 and Nasdaq were both up 0.7% for the week while the Dow had gained 0.4% through Thursday.

The U.S. agreed to a so-called phase one trade deal with China in principle, sources told CNBC. As part of the deal, the U.S. would scrap additional levies set to take effect on Sunday. The U.S. also proposed cutting tariffs on $360 billion in Chinese goods by up to 50%. One of the sources also told CNBC that President Donald Trump was focused on how much in U.S. agricultural products China would purchase.

“This has been going on for a while and we finally have good news,” said Mike Wilson, chief U.S. equity strategist at Morgan Stanley, on CNBC’s “Fast Money.” “But the question is, how much has been priced in?”

Bloomberg News and Dow Jones later reported that Trump had signed off on the deal, but investors were awaiting confirmation of the trade deal from China.

China and the U.S. have been fighting a trade war for nearly two years as the Trump administration tries to level what it sees as an uneven playing field. The trade war has dented business sentiment and has sparked volatile moves in capital markets.

Brexit boost

Stocks have been on a massive tear this year despite the lingering trade fears. Through Thursday’s close, the S&P 500 is up 26.4% for 2019. The Dow and Nasdaq are up 20.6% and 31.4%, respectively, this year.

Futures also moved after exit polls showed the U.K.’s Conservative party winning a big majority in Parliament, giving Prime Minister Boris Johnson a clear path to move forward with his Brexit plans.

The British pound surged more than 2% against the U.S. dollar, hitting its highest level since the summer of 2018.

On the data front, retail sales for November and import prices for November will all be released at 8:30 a.m. ET. Business inventories for October will follow slightly later in the session.

Market participants are also likely to monitor a speech from New York Fed President John Williams on Friday. The U.S. central bank policymaker is expected to comment on monetary policy, shortly after the Fed decided to keep interest rates unchanged.

No major corporate earnings were scheduled to be published on Friday.

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