US markets ended a holiday-shortened session higher as the US Black Friday shopping spree gathered steam and traders speculated whether President-elect Donald Trump may back off from his threatened tariffs.

The yen rallied against the US dollar as higher inflation in Japan fueled expectations that the central bank will hike interest rates again.

Traders are closing out a rollercoaster month for assets caused largely by Trump winning a second US presidential election -- and also a result of the wars in Ukraine and Gaza.

Markets are tracking developments surrounding Trump's pledge to hammer China, Canada and Mexico with hefty tariffs on his first day in office in January.

US stock markets closed higher on a shortened trading day, with the Dow and S&P 500 hitting fresh records following Thursday's Thanksgiving break.

The Dow Jones Industrial Average rose 0.4 percent to 44,910.65, the S&P 500 closed up 0.6 percent at 6,032.38 and the Nasdaq gained 0.8 percent to 19,218.17.

Chip companies notched gains after a news report that President Joe Biden's administration was mulling further curbs on semiconductor equipment sales to China that were less severe than anticipated.

Shares in Nvidia closed 2.2 percent up.

The market appears to be "cruising along here without any interference," said Patrick O'Hare of Briefing.com.

The Paris and Frankfurt stock markets closed higher, and London finished with more modest gains.

"With many US investors still out after being off for Thanksgiving yesterday, the key theme that has emerged in the last few days is the easing of tariff fears," said Fawad Razaqzada, market analyst at City Index and Forex.com.

This came after a phone call between Trump and Mexican President Claudia Sheinbaum, who afterwards said: "There will not be a potential tariff war."

The focus was also on shoppers seeking bargains on Black Friday, a crucial day for retailers around the world.

O'Hare said Black Friday has become less of a "frenetic rush" given the popularity of online shopping now -- although there is still a lot of attention on the retail space. (AFP)