World stocks pulled back from record highs on Friday as investors continued to rotate away from megacap growth stocks, while a global cyber outage hit services from airlines to banks and financial services and capped a turbulent week for markets.

A tech sell-off sparked by Sino-U.S. trade tensions, doubts over U.S. President Joe Biden's fate in the presidential race and growing chances of a win for rival Donald Trump, weak Chinese economic data and a lacklustre third plenum outcome have cast a shadow over the global mood.

U.S. stock index futures fell, indicating more pain on Wall Street after all three major stock indices suffered losses on Thursday. European stocks were broadly lower, while in Asia tech stocks continued to struggle.

MSCI's world stock index fell to a two-week low, retreating further from a record high hit earlier this month.

"The changing probability of a potential Trump presidency and what that might mean for different markets, whether it be his view of the dollar or tech regulation, has clearly created some market rotations this week," said Michael Metcalfe, head of global macro strategy at State Street Global Markets.

On top of that investors are looking closely at the Federal Reserve's response to improving inflation data and the U.S. earnings season, which is now in full swing.

"Tech has been where all the earnings growth has been (in recent years) so those will be the crucial thing for risk sentiment overall," said Metcalfe.

OUTAGE WOES

A global tech outage disrupted operations in multiple industries on Friday, with airlines halting flights, some broadcasters going off the air and everything from banking to healthcare hit by system problems.

Microsoft, meanwhile, fell 2.7% in premarket trading after the cloud disruption.

"Investors are already on edge for this tech rotation and this global outage adds a further dose of uncertainty," said Ben Laidler, head of equity strategy at Bradesco BBI.

European stocks fell 0.5%, while MSCI's broadest index of Asia-Pacific shares outside Japan slid 1.7% and was set for its worst week in three months with a nearly 3% loss. Japan's Nikkei closed just a touch lower.

Technology stocks continued to struggle in Asia, with South Korea's tech-heavy KOSPI index and Taiwan stocks both falling 1% and 2.26%, respectively.

In China, investors were left disappointed over the lack of details provided on the implementation steps for achieving economic policy goals at the conclusion of its closely watched plenum on Thursday.

Government bond yields in Europe and the U.S. nudged higher .

DOLLAR RECOVERS

In currency markets, the dollar clawed back some ground.

The dollar index, which measures the U.S. currency against six others, was up 0.17% higher at 104.33, up from a four-month low of 103.64 it touched on Wednesday.

It is set for a 0.2% gain for the week after two weeks of losses, with the currency undermined by growing conviction that the Fed could cut interest rates in September.

The euro slipped 0.12% to $1.0883, having dipped the previous session after the European Central Bank (ECB) kept rates on hold as expected, but left the door open to a September cut as it downgraded its view of the euro zone's economic prospects.

Two ECB policymakers on Friday backed further interest-rate cuts, expressing greater confidence that inflation was heading to the ECB's goal next year.

Sterling eased 0.2% to $1.2923 after data showed British retail sales volume fell by more than expected in June, while the dollar was broadly steady at around 157.45 yen.

In commodities, Brent crude prices fell by 8 cents, or 0.1%, to $85.03 a barrel. U.S. West Texas Intermediate crude futures fell 17 cents, or 0.2%, to $82.65 a barrel.

Gold eased 1%, retreating from a record high of $2,483.60 per ounce hit earlier this week on the prospect of lower global interest rates.

(Reporting by Rae Wee in Singapore and Marc Jones, Amanda Cooper and Dhara Ranasinghe in London; Editing by Andrew Cawthorne and Arun Koyyur)