Asian markets were mixed Monday on broad optimism that China and the United States are close to a mini trade deal, while Hong Kong rallied after last week’s hefty losses but investors remain on edge over violent protests that have wracked the city.

US traders sent the Dow above 28,000 for the first time on Friday after top White House officials played up the progress of negotiations with Beijing.

Donald Trump’s economic adviser Larry Kudlow said the first part of a wider pact was on track, while Commerce Secretary Wilbur Ross said that there’ll be a deal “in all likelihood.”

Then on Saturday, China said Vice Premier Liu He had spoken to US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, and had “constructive discussion on each side’s core concerns regarding the phase-one agreement”.

It added that the two sides will “continue to maintain close communication.”

The comments provided a much-needed fillip after differences over whether, when and by how much to reduce tariffs on each other’s goods spilled out into the open.

Trump this month denied the Chinese commerce ministry’s claim that the two sides had agreed to roll back existing tariffs as part of the deal, details of which have not been released.

Shanghai rose 0.1 percent and Tokyo ended the morning 0.3 percent higher, while Singapore put on 0.3 percent and Taipei added 0.2 percent.

“Also bullish for stock sentiment, investors are starting to think that business sentiment is now forming a bottom on a global scale and is likely to show modest improvement moving into 2020, with risks of near-term recession declining,” said AxiTrader’s Stephen Innes.

“Much of this view is dependent on a phase one deal with China getting signed, auto tariffs put aside, and hard Brexit risks subside,” he added.

But he warned: “Yet should an agreement not be reached and tariffs are raised further, it’s conceivable the global economy will continue to slide, very possibly into a recession in the quarters ahead.”

Hong Kong climbed more than one percent, having lost almost five percent last week, with traders keeping tabs on events in the streets after another weekend of clashes but with the city’s transport network avoiding the disruption that characterized last week.

Still, the situation remains on a knife-edge with demonstrators holed up in a university campus, trying to repel police with petrol bombs and bricks and officers warning they may use live rounds if confronted by deadly weapons.

The threat, which came after one officer was struck with an arrow, marked a further escalation of the near six-month crisis that has rocked the city and hammered the economy.

Observers pointed out that the situation could have an impact on the China-US trade talks, with lawmakers in Washington expected to pass a bill sought by protesters in Hong Kong that aims to defend civil rights in the city.

There are concerns the unrest could lead to the cancellation of elections planned for Sunday.

“Authorities will face a delicate balancing act on whether to postpone the polls, risking escalating protests, and claims of political interference; or hold them as scheduled,” said Jeffrey Halley, senior market analyst at OANDA.

“The Hong Kong administration’s track record on critical political decisions, won’t fill the markets with confidence.”