* Rally in Europe, gains in Asia cap wild week
* Payrolls data in view, Fed policy in focus
* Dollar slightly firmer, bund futures flat
By Lionel Laurent
LONDON, Oct 2 (Reuters) - Gains for European and Asia stocks
capped a wild week for financial markets on Friday, ahead of a
key U.S. jobs report that could determine the chances of the
Federal Reserve raising interest rates before year-end.
Concerns about U.S. monetary policy and slowdown in emerging
markets led by China have hit commodities markets and related
stocks like Glencore GLEN.L and sent credit spreads wider this
week in the wake of a summertime surge in volatility.
An escalation of fighting in Syria, with Russian air strikes
marking its biggest Middle East intervention in decades, has so
far failed to spook global markets beyond a rise in oil prices,
however, and global equities are set to end the week flat.
"European equities are trading higher this morning, trying
to stage a hesitant rebound after yesterday's bearish market
action," said Markus Huber, a trader at Peregrine & Black.
"While a very strong (U.S. data) reading would certainly
increase the likelihood of a rate hike this year, very few
expect that the Fed will pull the trigger as soon as October."
The pan-European FTSEurofirst 300 .FTEU3 up 0.8 percent,
while German Bund futures FGBLc1 were little changed.
The U.S. dollar index .DXY was slightly higher ahead of
nonfarm payrolls data expected to show the U.S. economy added
203,000 jobs in September, according to a Reuters poll. ECONUS
While years of cheap central bank cash in the wake of the
2007-2008 financial crisis have fuelled asset prices, recent
signs of a slowdown in global economic growth and the Fed's
decision last month to put off a rate rise have spooked
investors betting on a return to more normal policy.
Mixed data on Thursday failed to give more clues, with the
pace of growth at U.S. factories slowing in September while new
jobless claims pointed to a tightening labour market.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.3 percent, and was on track for a weekly
gain of 1.2 percent after posting its poorest quarterly
performance since 2011 with a decline of 17 percent.
Australian shares .AXJO fell 1.1 percent while Japan's
Nikkei Average .N225 fell 0.4 percent. Chinese markets are
shut for a week-long holiday with India also closed on Friday.
Beijing said on Wednesday it would cut the minimum
down-payment for first-time home buyers in many cities, the
second policy measure in two days to fire up Chinese
consumption.
"Even if this might not have much impact on property prices,
it shows the central government has policy intentions to boost
GDP growth," said Castor Pang, head of research at Core
Pacific-Yamaichi in Hong Kong.
On commodities markets, U.S. crude CLc1 rose 55 cents to
$45.29 per barrel while Brent LCOc1 rose to $47.95. Copper was
set to snap a two-week decline as investors bet production cuts
would support prices, though concerns about demand from top
consumer China remained.