Dalglish returned to the Anfield club's hotseat in January in place Roy Hodgson, on a deal until the end of the season, and the case for the 60-year-old to be handed the job on a permanent basis was only strengthened at the Stadium of Light.
Henry refused to go into details regarding discussions with Dalglish, saying that was not `the Liverpool way', but seemed pleased with the progress being made on the field.
When asked about a new contract, Henry said in the Daily Telegraph: "What is going on in that regard is private.
"It is something called `the Liverpool way' and you do these things behind closed doors.
"I am not going to talk about these things. He has done very well."
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Source: PA