Tokyo -Tokyo equity investors will focus on what are expected to be downbeat Japanese GDP figures next week, on the back of fears about China's economy after a series of yuan devaluations.
On Monday, official growth data for three months to June will be published, after stronger-than-expected figures in the first quarter.
The 1.0% expansion in January-March - or 3.9% on an annualised basis - was sharply up from an initial estimate of 0.6% growth.
But economists have warned that tepid data since point to a marked slowdown in the world's number three economy during the latest quarter.
"We think the economy was stuck in the doldrums in the quarter due to sluggish spending and stagnant exports," said Japan Research Institute economist Yusuke Shimoda, pointing to strong business and trade links between Tokyo and Beijing.
"China's economic slowdown may send the Japanese economy down further in the current quarter."
China's central bank slightly raised the value of its yuan currency on Friday against the US dollar, ending three days of falls after a surprise devaluation this week sent financial markets into a tailspin.
The stronger fixing for the yuan came after the People's Bank of China reassured financial markets by pledging to seek a stable currency after a shock cut of nearly two percent on Tuesday.
But investors continued to fret about the fallout for the Jap
London - European stocks edged higher on Friday, buoyed by auto and travel stocks, although they remained on course for a weekly decline after China moved to weaken its currency.
After devaluing the yuan early in the week, China's central bank said on Thursday the country's strong economy meant there was no reason for the currency to fall further, helping to calm jittery global markets.
Those reassurances helped the pan-European FTSEurofirst 300 close 0.9% higher on Thursday.However, it remains down 2.5% for the week, its biggest weekly decline in nearly a month, after China's devaluation hit mining, auto and luxury stocks.
The pan-European FTSEurofirst 300 was up 0.3% at 1535.18 points by 07:47 GMT, with carmakers continuing to rebound, up 1%. But traders said they would monitor the yuan in the coming days before making bigger bets.
"It was quite a shock what the Chinese did, there was no pre-warning. As the dust is still settling, the market is pausing here," Markus Huber, senior sales trader at Peregrine & Black, said. "If the yuan (stays) halfway stable over the next few days, then confidence is going to come back."
Carmakers were also boosted by a 2.4% rise in Porsche after prosecutors dropped a market manipulation investigation into a member of its board.
Travel and leisure shares also rose. A 3% gain by TUI led the FTSEurofirst 300.
TUI's advance began on Thursday, after it said core earnings would come in at the top end of its forecasts this year. That brought on a spate of broker upgrades and positive comments from banks.
"We think TUI's Q3 results and new guidance should reassure the market," analysts at Barclays said in a note, reiterating an "overweight" rating on the stock. "It serves to reinforce our positive stance that TUI's scale and diversification is under-appreciated."
Aegon fell 1.8%, hit by a cut in target price from ING after it released disappointing results on Thursday.
Among top sectoral fallers on Friday, oil and gas firms dropped 0.4% after US crude oil fell below $42 a barrel to prices not seen since March 2009.
Chinese economy and shares in companies with exposure to China have been hit hard in Tokyo this week.
"While CNY (yuan) devaluation may be paused for the moment, it is still quite likely to see further declines over the coming months," said Angus Nicholson at IG Markets.
"These concerns are still weighing on the Nikkei."
On Friday, the benchmark Nikkei 225 index at the Tokyo Stock Exchange slipped 76.10 points to 20 519.45. It lost 0.99% over the week.
The Topix index of all first-section shares declined 3.49 points to 1 664.46, taking the week's losses to 0.88%.
In Tokyo share trading, Toyota ended flat at ¥7 945 and Fuji Heavy Industries jumped 1.69% to ¥4 660, while Mazda slipped 0.66% to ¥2 394.5.
The three companies were reportedly affected by huge explosions in Tianjin, China, that left 50 dead.
Market heavyweight Fast Retailing, which operates the Uniqlo chain, fell 0.94% to ¥54 990.
In currency markets, the dollar traded at ¥124.36 against ¥124.43 in New York.