Wall Street stocks finished at fresh records on Friday as China-US trade progress restored the market to its heights prior to a spring swoon brought by President Donald Trump's tariffs.

Both the S&P 500 and Nasdaq finished at all-time highs following a roller-coaster session that included a stint in negative territory after Trump announced he was breaking off trade talks with Canada, rupturing a series of largely positive headlines on trade.

The broad-based S&P 500 finished up 0.5 percent at 6,173, while the tech-rich Nasdaq Composite Index also climbed 0.5 percent to 20,273. Both represent fresh closing records.

The Dow Jones Industrial Average jumped one percent to 43,819.

Earlier, European stock markets also rose, with the Paris CAC 40 leading the way, boosted by a rise in luxury stocks.

The records reflect improved sentiment, with the Iran-Israel ceasefire adding to positive movement on trade compared with the spring.

"There is hope in the market, there may be some over-optimism around some things," said Jason Schenker of Prestige Economics. "But there was a lot of optimism."

Tom Cahill, chief investment officer at Ventura Wealth Management said other trade news developments in recent days had been positive, including Beijing and Washington's confirmation on finalising a framework to move forward on trade.

"The news has been incrementally more positive since April on the trade front," Cahill said.

The S&P 500 last hit a record in February, but began to come under pressure thereafter as Trump began to sharpen his rhetoric on trade. This culminated with Trump's April 2 "Liberation Day" vow to implement steep new levies on trading partners.

Trump has since suspended the most onerous elements of his trade overhaul, while still implementing the biggest US tariffs imposed in decades. (AFP)