Asian shares staged a rebound on Friday to set course for their first gains in two weeks, with Shanghai managing a modest recovery from a rout that saw its shares crumble to near 4-year lows.
The strong gains soothed investor sentiment, which was hit after a major volatility index, seen as Wall Street's fear gauge, rose to an eight-month high.
European shares are seen the following suit, with spreadbetters expecting London's FTSE to open up 0.4 per cent, and Frankfurt's DAX and Paris' CAC 1.0 per cent.
Shanghai shares bounced 0.8 per cent, recouping earlier losses of 1.8 per cent as cheap valuations drew bargain hunters.
"Since yesterday, trading volume has been fairly big suggesting strong buying interest," said Naoki Tashiro, president of TS China Research in Tokyo.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 2.0 per cent, the biggest in more than two years.
But the bounce came after the index fell 3.6 per cent on Thursday to hit a 1-1/2-year low. On the week, it is still on track for a weekly loss of 3.6 per cent.
The biggest market shakeout since February has been blamed on a series of factors, including worries about the impact of a Sino-U.S. trade war, a spike in U.S. bond yields this week and caution ahead of earnings seasons.
Japan's Nikkei average rose 0.5 per cent while the U.S. stock futures gained 1 per cent in Asian trade on Friday, in part helped by a media report that the U.S. Treasury Department will not call China a currency manipulator in its upcoming semiannual report.
Earlier, Wall Street offered Asia a weak lead overnight with the U.S. S&P 500 falling just over 2 per cent to a three-month low, following a 3.29 per cent drop on Wednesday.
"The (U.S. share) market is now about 7 per cent off of its 100-day high, but this is far from a rare occurrence historically," economists at RBC Capital Markets wrote in a research note.
"Indeed, history is littered with over 5 percent-ish type selloffs in the midst of economic expansions," they said.
"The sharp sell-off we are seeing in the market has left a lot of folks wondering if this is the beginning of the end. Investors shouldn't panic," said Christopher Smart, head of macroeconomic and geopolitical research at Barings.
"So far, it has the feel of a temporary correction that will take some of the excess air out of tech stocks. But the volatile markets mean that economic data and corporate earnings will get even closer scrutiny in the weeks ahead. "
Chinese trade figures on Friday showed, however, China's trade surplus with the United States hit a record high in September, providing a likely source of contention with U.S. President Donald Trump over trade policies and the currency.
The data showed a solid expansion in China's overall imports and exports, suggesting little damage from the tit-for-tat tariffs with the United States.
CBOE Volatility index rose on Thursday to its highest close since Feb 12, pointing to investors concern of further losses in markets.
So far this week, Chinese and U.S. shares are among the worst performers in a sign investor worries about the trade war are deepening.
MSCI's U.S. index has shed 5.5 per cent, compared with a 4.9 per cent fall for MSCI's gauge of stock performance in 47 countries. China A shares are still down 8.7 per cent.
Gold, typically seen as a safe-haven asset at times of high uncertainty, held steady on Friday.
It fetched $1,221.9 per ounce, keeping the 2.5 per cent gain from Thursday, which was its biggest percentage rise since June 2016.
The yield on 10-year U.S. notes edged up 4.5 basis points in Asia to 3.176 per cent, reversing earlier falls on flight-to-quality bids.
It is still off its seven-year high of 3.261 per cent touched on Tuesday, but a further rise in the U.S. borrowing costs could hurt risk sentiment.
"Asian stocks appeared to have stabilised but ultimately where U.S. bond yields will settle down will be key," said Teppei Ino, senior analyst at MUFG Bank.
Adding confusion for investors, Trump launched a second day of criticism of the Federal Reserve on Thursday, calling its interest rate increases a "ridiculous" policy.
While that does not appear to have shaken investor confidence in the Fed's independence, some investors suspect expectations on future rate hikes could be undermined if Trump raises his threats levels.
"I doubt Trump will tolerate the further rise in U.S. rates ahead of U.S. mid-term elections. I believe the rise in U.S. yields and the dollar's rally are coming to a turning point," said Naoki Iwami, fixed income chief investment officer at Whiz Partners in Tokyo.
The dollar lacked momentum against a basket of major currencies as U.S. bond yields stayed off recent peaks.
The euro ticked up slightly to $1.1590, after a gain of 0.65 per cent on Thursday.
But the yen eased to 112.35 to the dollar after hitting a three-week high of 111.83 on Thursday.
The Chinese yuan weakened about 0.3 per cent, giving up some of the gains it had made the previous day.
Oil prices bounced back on Friday.
Brent crude futures rose 1.2 per cent to $81.25 a barrel, holding off a four-year high of $86.74 touched on Oct 3.
(With inputs from agencies.)