"There is still some uncertainty as to whether the Fed will scale back QE3 [its third round of quantitative easing] in September or December, and how precisely tapering will be conducted," said Capital Economics' Jessica Hinds, in a research note.
Atlanta Fed president Dennis Lockhart told CNBC that the data needs to show "sustainable" economic growth in order for the central bank to start cutting back on its monthly bond purchases. But he wouldn't rule out some sort of September move.
(Read more: Fed's Lockhart: I could get comfortable with a move in September of some kind)
James Bullard of the St. Louis Fed, meanwhile, told CNBC the central bank should take its time and assess the situation before reducing stimulus. "Inflation is running low, you've got mixed data on the economy, so I'd be cautious and I wouldn't want to pre-judge the meeting," he said.
Data out on Thursday pointed to improvement in the global economy. U.S. PMI posted its best showing since March, while euro zone PMI data also beat expectations. Both followed China's HSBC PMI figure, which hit a four-month high in August. The data helped push U.S. shares to a higher close, despite the Nasdaq trading halt.
(Read more: Nasdaq gets another black eye, industry under scrutiny)
On Friday, new home sales for July will be reported at 10 a.m. Any marked changes could move markets, as the Fed has said that its decision on when to start scaling back asset purchases will be based on U.S. economic indicators. Economists forecast a 1.4 percent drop to an annualized rate of 490,000 units in July, after an 8.3 percent rise in the previous month.
Turning to earnings reports, Pandora Media shares were falling after the company warned that earnings for fiscal 2014 would fall below analyst estimates as expenses to buy music rights and expand its sales personnel rise.
Retailers were also in focus again with solid results from Gap, Ann and Foot Locker and a weak print from Aeropostale.
Other stocks to watch on Friday include Apple, after billionaire investor Carl Icahn tweeted that Apple CEO Tim Cook was planning a bigger buyback. Icahn revealed last week that he had taken a large position in Apple, which is estimated to be worth more than $1 billion. In addition, several images were leaked on Thursday of what appears to be Apple's new line of iPhones.
(Read more: Icahn: Meeting Apple's Cook next month on buybacks)
Bank stocks will also be in focus, after Moody's Investors Service warned it might cut the credit ratings of the six biggest U.S. banks — Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo — saying the government may be unlikely to bail them out should they face trouble in the future.