Financial markets focused on Friday on upcoming U.S. jobs data for a guide to the path of interest rates, leaving stocks mixed, the dollar clinging on to recent gains and bonds weaker.
The U.S. non-farm payrolls report for June (1230 GMT) is expected to show the U.S. labor market remains firm, bolstering the view that a solid economy will keep down the chances of an interest rate cut this year.
That view has pushed up bond yields recently, setting off concerns that a higher cost of borrowing will squeeze out of the market the liquidity that has been behind many asset price gains.
The U.S. data will decide the trading trend, German bank Helaba said in a note.
A report on Thursday from private employment services company ADP Employer Services pointed to strong jobs growth, leading market participants to believe the jobs data may be stronger than expected.
In a Reuters survey, economists' median forecast was for 120,000 new jobs to have been created in June compared with 157,000 in May.
European stocks generally opened higher with the pan-European FTSEurofirst 300 index (.FTEU3: Quote, Profile, Research) 0.17 percent higher.
London's FTSE 100 rose 0.48 percent and the French CAC 40 was up 0.19 percent, but Germany's DAX lost 0.06 percent.
Earlier, Japan's Nikkei stalled after a six-day rally. The benchmark finished down 80.54 points at 18,140.94, ending lower for the first time in seven sessions. The broader TOPIX index lost 0.47 percent to 1,779.67.
Globally, however, stocks remain close to all-time highs.
The dollar held on to Thursday's gains against the euro and sterling but was just off 2-month and 26-year lows respectively.
The yen's low-yielding status also stayed in focus with the euro hitting a record high of 167.48 yen versus the Japanese currency according to Reuters data.
Sterling eased slightly to $2.0092, after touching $2.0208 on Reuters dealing system on Wednesday, its highest level since 1981.
The Bank of England raised interest rates on Thursday, as expected, to 5.75 percent.
The euro was flat at $1.3588.
Euro zone government debt prices slipped ahead of the jobs data. The benchmark 10-year yield was up 1.1 basis points at 4.665 percent while the 2-year Schatz yield was 4.524 percent, up 5.1 basis points.
The European Central Bank left interest rates unchanged at 4.0 percent on Thursday.