A look at the day ahead in European and global markets from

Kevin Buckland

An element of calm has returned to markets as a wild week

winds down, with European and U.S. stock futures pointing

overall higher on Friday following the frenetic selling of the

previous two days.

Asia-Pacific equity benchmarks were overall flat to higher,

with some weakness in Chinese markets contrasting with robust

gains for Australia and South Korea.

Taiwan was an unhappy exception, though, with a 3.4% slide -

a delayed reaction to the global tech rout after markets there

were shuttered the previous two days by a typhoon.

Currency markets stabilised as well, with the yen finding a

home around 154 per dollar following its surge from a

three-decade low near 162 just over two weeks ago. On Thursday,

it reached a nearly two-month peak of 151.945 per dollar.

Investors were frantically unwinding long-held bearish

yen bets and/or seeking a safe haven play with the Japanese

currency, spurred by a spate of weak U.S. economic data, the

global equity sell-off, and growing speculation of a Bank of

Japan rate hike next week - not to mention the helping hand of

some deft currency intervention by Tokyo.

IG analyst Tony Sycamore said there's "a brick wall of

demand" for dollars around 152 yen that he expects to hold firm

until Wednesday of next week, when both the BOJ and Fed decide

policy. "After that, all bets are off."

The dollar also drew a modicum of macro-related support from

faster-than-expected U.S. GDP growth in data released overnight,

alleviating fears that the economic expansion was at risk of

ending abruptly.

However, a cooling of price pressures keeps bets alive for a

September Fed cut, and the dollar is edging lower against the

likes of the euro and sterling heading into the European

morning.

There's little in the way of economic data or earnings

reports to shake up markets in European hours, but the U.S. PCE

deflators - a favourite inflation measure of the Fed's - could

inject some additional volatility before the weekend.

Key developments that could influence markets on Friday:

-US PCE price index (June)

-US earnings include 3M, Bristol Myers Squibb, Colgate

Palmolive