The British pound stabilized against the US dollar during the European session on Friday, to stay rangebound but on the cusp of posting a weekly gain, as the US dollar rally hit a pause, in addition to upbeat news about the UK election, and rising expectations for the Conservative Party (ruling party) to bag the majority in the December 12 election.

GBP/USD held at $1.2877 as of 07:10 GMT, after opening at $1.2881, with an intraday high of $1.2885 and a low of $1.2875.

Sterling gained 0.25% against the US dollar yesterday, its first gain in three days, as the retreat in the US dollar offset the unexpected drop in British retail sales during October.

During this week, the British pound gained 0.8% against the US dollar so far, to head for its second weekly gain in the last three weeks, thanks to the US dollar rally hitting a pause, in addition to upbeat news about the UK election.

The dollar index fell on Friday by less than 0.1%, to deepen its losses for the second straight day, on the continued profit-taking from a 4-week high, to reflect a pause of its rally against a basket of currencies.

The Brexit Party stated that it will not compete in the next parliamentary elections for seats won by the conservatives in the previous parliament, which is a big boost for Prime Minister Boris Johnson ahead of the elections in December 12.

The Brexit party leader, Nigel Farage, said that he does not want the anti-Brexit parties to win, so his party will not present candidates to compete on the seats won by Conservatives in the 2017 election.

Most expectations currently suggest that UK's ruling Conservative Party may win a majority in the December 12 election, which raised hopes about a breakthrough of the Brexit crisis ahead of January 31, and the latest deal by PM Boris Johnson with EU to be passed in the next British Parliament.

Oil prices fell on Friday, to deepen losses for the second straight day, on concerns over the US supply glut after a surprise rise in the US crude inventories and oil production, while these losses are being ebbed by hopes about a headway in the US-China trade talks.

West Texas Intermediate (WTI) fell to $56.44 a barrel, from the opening of $56.85, with a session-high of $57.09, Brent fell to $61.72 a barrel, after opening at $62.32 and hit a high of $62.60.

WTI closed yesterday lower by 0.8%, and Brent futures lost 0.3%, after the EIA weekly report.

The US Energy Information Administration (EIA) revealed yesterday that commercial inventories rose by about 2.2 million barrels during the week ending November 8, beating forecasts of 1.5 million barrels.

The total commercial inventories rose to 449.4 million barrels, the highest since the week ending July 12, which is a negative sign on the domestic demand in the US, and the production levels increased by 200,000 barrels, to reach a new record high of 12.8 million barrels per day.

The White House economic adviser Larry Kudlow said on Thursday that are getting close to the first phase of the trade agreement and "the mood music is pretty good."

Which has renewed hopes about a headway in the US-China trade talks after conflicting news over the past few days.

The US dollar fell against a basket of currencies on Friday, to deepen its losses for the second day, due to continue profit taking from a 4-week high, ahead of the release of key US data later today about monthly retail sales and industrial production.

The dollar index fell against a basket of currencies by 0.1% to 98.12 points, after opening at 98.20, and hit an intraday high of 98.23.

The US dollar fell by 0.2% yesterday, on profit taking from a 4-week high of 98.45 it hit in the previous day.

The profit taking overshadowed the positive data in the US that showed unexpected rise in producer prices in October, which is a positive sign on inflation levels in the US economy.

Investors are awaiting the release of the US retail sales for October, which is one of the most important gauges of consumer spending that accounts for 70% of the GDP, in addition to other data about the industrial production which accounts for the remaining 25%. The US dollar will deepen its losses further should these data showed weak performance.

The US retail sales reading monthly will be released at 13:30 GMT, with forecasts for a rise by 0.1 in October vs. a drop by 0.3% in September, and the core reading for the same index (excluding car sales) is expected to rise by 0.3% vs. a drop by 0.1%.

At 14:15 GMT, monthly industrial production will be released, with forecasts for a contraction by 0.4% in October unchanged from the previous reading, and the capacity utilization rate is expected to reach 77.2% in October vs. 77.5%.

European stocks rose in Friday's early trading, near 4-year highs after two days of losses due to profit-taking, while the rally today is buoyed by the renewed hopes about China and the US finally reaching a deal.

Stoxx Europe 600 rose by 0.4% as of 08:35 GMT, as it closed lower by 0.3% yesterday, its second straight daily loss, on profit-taking from 4-year highs. 

The index opened today's session higher, on the cusp of its first daily gain in 3 days, near touching the highest level since July 2015, with most of the major European exchanges and sectors seeing green today.

The mining sector saw the largest gains in Europe today, with a rise by 1.6%, as the sector is one of the most sensitive ones to global trade news.

The White House economic adviser Larry Kudlow said on Thursday that are getting close to the first phase of the trade agreement and "the mood music is pretty good," according to Reuters.

S&P 500 futures rose by 0.4% today to hit all-time high, after it closed higher by 0.1% yesterday at Wall Street, to mark the second straight daily gain.

Back to Europe, the Euro Stoxx 50 index rose by 0.4%, the German DAX rose by 0.3%, and France's CAC 40 roseby 0.6%, while in London, the FTSE 100 rose by 0.3%.