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Markets fluctuated Friday as traders positioned themselves ahead of a highly anticipated US jobs report later in the day and after a mixed bag of economic data on the world's top economy.
As a rollercoaster week drew to a close, debate centred on the Federal Reserve's plans for interest rates when it meets in less than a fortnight, with most observers expecting a 25-basis-point cut.
However, analysts say it could go twice as big if the non-farm payrolls report for August comes in well below forecasts, as a series of recent figures suggest the economy is slowing more sharply than initially thought.
A big miss in July's reading fanned fears of a recession and was a key driver of the rout across markets at the start of last month.
Investors were given a slight jolt by data Thursday showing a miss on private-sector hiring, which was slightly offset by a dip in first-time and continuing claims for jobless benefits.
A separate report pointed to a marginal increase in activity in the key services sector, which beat expectations.
"There has been nothing in the latest batch of US economic data... to materially impact on expectations for (Friday's) all-important employment data or to move the dial on expectations for what the Fed is likely to do on September 18," said National Australia Bank's Ray Attrill.
Wall Street ended the day on a tepid note, and Asian investors were equally cautious.
Shanghai, Seoul, Mumbai and Wellington fell along with London, Paris and Frankfurt.
Tokyo was weighed by a strong yen, which has picked up against the dollar on the back of bets on a Fed rate cut and growing expectations the Bank of Japan will continue hiking its own borrowing costs.
Still, Sydney, Singapore, Taipei, Manila, Jakarta and Bangkok rose. Hong Kong was closed due to a typhoon.
The broadly calm end to the week came after markets were sent tanking Wednesday following a disappointing read on factory activity and worries about tech firms' valuations -- particularly chip giant Nvidia -- after a rally this year.
Analysts warned there was a lot of risk in Friday's jobs figures, with a sharp drop likely to boost bets on a 50-point cut but stoke fresh recession worries, while an above-forecast read would dent hopes for a series of cuts this year.
Traders have factored in one percentage point's worth of reductions before the end of the year.
"One thing is becoming increasingly evident: the more the market leans into the idea of a 50 basis point cut, the shakier equities get," said Stephen Innes in his Dark Side Of The Boom newsletter.
"This week's relentless market slide is a reflection of mounting fears that a 50 basis point cut isn't a soft cushion but rather a red flag signalling turbulent economic waters ahead."
- Key figures around 0710 GMT -
Tokyo - Nikkei 225: DOWN 0.7 percent at 36,391.47 (close)
Shanghai - Composite: DOWN 0.8 percent at 2,765.81 (close)
Hong Kong - Hang Seng Index: Closed for typhoon
London - FTSE 100: DOWN 0.2 percent at 8,225.98
Dollar/yen: DOWN at 142.40 yen from 143.42 yen on Thursday
Euro/dollar: UP at $1.1122 from $1.1110
Pound/dollar: UP at $1.3186 from $1.3180
Euro/pound: DOWN at 84.17 pence from 84.29 pence
West Texas Intermediate: UP 0.5 percent at $69.52 per barrel
Brent North Sea Crude: UP 0.5 percent at $73.05 per barrel
New York - Dow: DOWN 0.5 percent at 40,755.75 (close)
F.A.Dsouza--DT