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By Saikat Chatterjee
HONG KONG, Oct 2 (Reuters) - Asian stocks firmed on Friday and appear set to end the week higher, although the outlook remained grim as investors continued dumping emerging market assets as their growth expectations faded. The dollar crept higher.
Financial spreadbetters expect Britain's FTSE 100 to open 0.3 percent up, Germany's DAX to open 0.4 percent higher, and France's CAC 40 to open 0.6 percent up.
Hong Kong stocks led the region's gainers with a 2.6 percent rise, lifted by a bounce in the Chinese Enterprise Index which tracks Chinese companies listed in Hong Kong, after latest policy steps to shore up the flagging economy.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3 percent, and was on track for a weekly gain of 1.2 percent. It posted its poorest quarterly performance with a decline of 17 percent, the worst since 2011.
Australia's shares fell 1.1 percent while Japan's Nikkei Average fell 0.4 percent. China is shut for a week-long holiday and India is closed for a local holiday.
Beijing on Wednesday said it would cut the minimum down payment level 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.
However, a number of economists pointed out the broader economic outlook for the region remained bleak.
"The difference between new orders and inventories is a good leading indicator for industrial production in Asia," said Frederic Neumann, co-head of Asian economics research at HSBC in Hong Kong. "Unfortunately, this signals a further deceleration of activity into the year-end."
In line with falling economic activity, earnings growth expectations for the remainder of the year for MSCI Asia-ex Japan have been slashed to their lowest levels this year, according to Thomson Reuters data.
Net non-resident portfolio flows to emerging markets were negative for the third consecutive month in September, with investors estimated to have pulled out $40 billion worth of funds in the third quarter, making it the worst since December 2008, according to the Institute of International Finance.