Asian stocks are set for their first weekly rise in a month buoyed by coordinated central bank actions, while the euro held on to hefty gains before European policymakers make a fresh stab to tackle its crisis at a summit next week.

Most Asian markets succumbed to some profit-taking on Friday after Thursday's jump on caution ahead of monthly U.S. payrolls data due later in the day and an important European summit on December 9.

European shares are set to open higher with financial spreadbetters predicting that Britain's FTSE 100 <.FTSE> would open 0.6 percent up, Germany's DAX <.GDAXI> would gain 0.5 percent, and France's CAC-40 <.FCHI> would rise 0.6 percent.

While the move by major central banks to together cut the cost of funds in money markets led to a relief rally in stocks and currencies this week, the undertone remains subdued as investors seek a more permanent resolution to Europe's crisis.

We're in consolidation mode but it's basically down to the non-farm payrolls today and then back to Europe next week, said Christian Keilland, head of trading at agency brokerage BTIG in Hong Kong.

And the propensity of Europe to drop the ball on these is huge, he said. Funds that are flat to down this year are probably going to scramble and try push things higher but its going to be difficult.

European Central Bank President Mario Draghi is urging progress towards a new euro-zone fiscal program and is willing to act more aggressively, while the leaders of France and Germany are working hard at a compromise.

Stock indices in Asia slipped after Thursday's bounce. Hong Kong <.HSI>, Shanghai <.SSEC> and Korea <.KS11> trended lower while MSCI's broadest index of Asia Pacific shares outside Japan <.MIAPJ0000PUS> edged lower after jumping more than 4 percent on Thursday. For the week it is up more than 8 percent.

LIBOR DIPS

While the coordinated action by central banks pushed dollar LIBOR rates down for the first time in more than four months, traders said more steps need to be taken to thaw the spreading freeze in money markets.

Even as London interbank offered rates for three-month dollars fell to 0.52722 percent on Thursday from 0.52889 percent in risky assets, its first decline since July 22, some traders used the bounce as a selling opportunity.

The rising cost of dollar funds have sapped demand for Asian credits and hurt issuance going into the year end period.

Traders said borrowing via these new swap windows would be small due to a variety of factors such as the decline in external liabilities of euro area banks, the stigma associated with borrowing from the ECB and a lack of eligible collateral among banks, which may be addressed in next week's euro summit.

It does feel a little better but we are seeing sellers into the strength, said a Singapore-based trader with an Asian bank. No one is massively in a risk on mode at the moment.

In credit markets, spreads on the Asia ex-Japan iTraxx investment grade index held around 200 basis points compared to 206 bps in the previous session.

In currencies, the euro struggled to extend its chunky gains of this week, with traders focused on the closely watched U.S. non-farm payrolls report due later on Friday.

Due at 1330 GMT, the labour data is expected to show an increase of 122,000 jobs and a steady unemployment rate of 9.0 percent. A positive surprise is likely to underpin risk sentiment, while a weaker-than-expected outcome could prompt investors to take more profits on recent gains.

U.S. Treasury prices extended declines with ten-year yields trading around 2.09 percent, above a 1- month low of 1.89 percent hit last week.

Spot gold traded broadly flat around $1,740 per ounce while U.S. crude futures dipped slightly to around $100 a barrel.

(Additional reporting by Vikram Subhedar, Umesh Desai and Ian Chua)

(Corrects to say European shares may open higher)