LONDON: European stock markets slid Friday as dealers nervously awaited vital non-farm payrolls data in the United States for clues on the path for interest rates in the world's biggest economy.

Frankfurt and London indices each lost 0.3 percent in value while Paris slid 0.4 percent, after a mixed session earlier in Asia.

Asian bourses meanwhile fluctuated as investors steeled themselves for the release of a jobs report that could have a major bearing on the size of an expected Federal Reserve interest rate cut.

With uncertainty over the China-US trade row put aside for now, this week has been dominated by speculation about the US central bank's plans to address a weakening economic outlook, both at home and globally.

The jobs report is a closely watched gauge of the state of the world's biggest economy and a below-forecast reading would ramp up hopes the Fed will announce a 50-basis-point reduction.

"Today's US payrolls report has the potential to upset the apple cart when it comes to whether or not we can expect to see a Fed rate cut later this month, and if we do whether it will be 25 or 50 basis points," said CMC Markets analyst Michael Hewson.

And Pepperstone Group head of research Chris Weston added that "a number in line with consensus probably delivers that July cut and I think that's what the market wants to see".

"If we get a really strong number, I think risk could really come off the table," he told Bloomberg News.

The clamour for a Fed rate cut comes as central banks around the world take a more accommodative position to offset economic weakness blamed on trade uncertainty, particularly the China-US standoff.

- Delicate balance -

Adding to the cautious trading environment was the lack of a lead from Wall Street, which was closed for the Independence Day celebrations.

"If there is one thing financial markets hate it's a delicate balance between risk-on and off, suggesting something will give shortly," said Stephen Innes at Vanguard Markets.

"Over the short run, 'risk-on' sentiment should prevail on the back of the deluge on central banks easing. The Fed is critical to the 'risk-on' fever," he said, adding that "now is the time to shift easing policy into high gear".

Oil prices fell as traders fret over the impact of weak global growth on demand, which is overshadowing this week's agreement by OPEC and Russia to extend their output caps.

Even the US-Iran crisis has been unable to perk up the commodity, with news that Britain had intercepted an Iranian oil tanker near Gibraltar -- suspected of carrying crude to Syria -- providing no support.

Washington praised the move but Tehran called it an "illegal interception", adding to geopolitical tensions. —AFP