Currency policy makers in China continue to puppet global stocks as the world watches global volatility in world markets.
"Confidence in China's ability to manage their capital markets has only been further damaged after they announced the removal of their "circuit breakers" after only being in place for four days", said Angus Nicholson of IG in a report.
Though much could depend on the 1330 GMT (7:00 p.m.in India) payrolls figures, Wall Street, which opens at 1430 GMT (8:00 p.m.in India), was expected to see a small bounce after a five percent fall this week, one of its worst starts to a year on record.
Adding to the gloom, oil slipped below $33 a barrel to near 12-year lows due before regaining some ground. Oil prices rebounded, the safe-haven yen weakened and gold gave up gains after hitting a nine-week high above $1,100 an ounce, reflecting improvement in risk appetite. The Dow fell 2.3 percent, the tech-heavy Nasdaq lost 3 percent and the S&P; 500 shed 2.4 percent.
The latest devaluation of the yuan by China's central bank has curbed buying interest in USA dollar-denominated LNG imports for now, according to Chinese buyers.
The United States economy added 292,000 jobs last month unemployment rate held at a seven-and-a-half year low of 5%.
When British finance minister George Osborne warned of a "dangerous cocktail" of economic threats on Thursday - fretting over slower growth in China, Brazil and Russian Federation, tension in the Middle East and stock market falls - he was urging against complacency at home, where economic growth has been robust. Japan's Economy Minister Akira Amari reportedly said that continued oil price falls are not good for the world economy, but would help improve Japan's term of trade. Investors were spooked Thursday when the government guided the tightly controlled currency sharply lower, in what was interpreted as a panicked effort to stimulate the economy by helping beleaguered exporters.
Richard Hunter, head of equities at Hargreaves Lansdown stockbrokers, said: "With the Chinese deciding that the idea of a circuit breaker is broken, withdrawing the facility after just four days with it having been triggered twice, some stability returned to Asian markets overnight and London in turn".
China has halted trading quite suddenly for the second time this week. However, Hong Kong's Hang Seng index gained 0.59% on Friday on the back of improvement in Chinese trading screens. For the last eight days running, it's allowed the yuan to depreciate.
Europe's main indices closed with losses of about 2.0% Thursday as signs of a dramatic slowdown in powerhouse China put fright into investors about the outlook for the world economy.
China set up a new yuan index composed of 13 currencies in December, saying that the currency's performance shouldn't be measured against the dollar alone.
The onshore yuan recovered to 6.5887 in morning trade, while the offshore yuan was about 1.4 percent weaker at 6.6840, narrowing a spread that reached around 2 percent a day earlier, which made the central bank's currency management task more complicated. If the Communist Party isn't able to take meaningful steps, however, analysts see more trouble ahead for both the yuan and stocks.
But that may mean even more volatility in a year that has already had a lot.