World stocks set to end the week at all-time highs

Those gains filtered through to global stocks, lifting the MSCI All-Country World index 0.3 per cent to a record high.

"This report, combined with other factors, including declines in auto sales, raises questions about the recent hawkish tone of Fed officials, who have hinted at potentially more rate hikes and a start of the process of balance-sheet shrinking this year", Duncan said.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS ticked up 0.1 percent, while Japan's Nikkei .N225 gained 1 percent to top the psychologically important 20,000-point level for the first time since August 2015.

European shares were also expected to advance, with spread-betters looking at gains of 0.6-0.7 percent for Germany's DAX .GDAXI, France's CAC .FCHI and Britain's FTSE .FTSE.

The Dow Jones Industrial Average notched 135 points to close at 21,144.18.

Following the latest data, the Atlanta Federal Reserve's closely-watched GDP Now forecast model showed on Thursday that the USA economy is expected to grow at a 4.0 percent annualised pace in the second quarter.

The nonfarm payrolls report on Friday, is expected to show that the USA economy created 185,000 jobs last month, and will be closely watched as it is the final jobs report before the Federal Reserve Open Market Committee (FOMC) meets in June. They also supported the outlook for possibly another hike by the year-end, likely in September.

Stock futures on Wall Street trimmed gains slightly and were last trading little changed. The U.S. economy created 66,000 fewer jobs than previously reported in March and April.

"People may be waiting for the payroll data".

The euro was 0.6 percent higher against the dollar at $1.1276, after earlier rising to a seven-month peak of $1.1282.

A reading above 50 indicates that the manufacturing economy is generally expanding; below 50 indicates that it is generally contracting. The IHS Markit's Manufacturing Purchasing Managers' Index for the euro zone rose to 57.0 in May, up from April's 56.7 and its highest level since April 2011. It could raise its assessment of risks to balanced or begin discussing shift from its bias to ease policy, a Reuters poll of economists showed.

That helped the dollar recover in the foreign exchange market.

The offshore Chinese yuan hit its highest level since October on Thursday, a move traders believe was engineered by Chinese authorities as a show of strength to scare off yuan sellers after Moody's downgraded China last week.

Wall Street stepped into June with confidence on Thursday with each of the three benchmark indexes scoring new all-time highs.

Oil prices were dragged down by ongoing concerns over a global glut in crude supply despite a bigger-than-expected draw in US crude inventories. U.S. West Texas Intermediate crude futures fell 87 cents to $47.49 per barrel.

  • Zachary Reyes