World shares rose half a percent to one-week highs on Friday while the euro clung to gains from the previous session on hopes that European policymakers would finally come up with a bold plan to combat a deepening debt crisis.

Risk appetite received a shot in the arm on Thursday following coordinated action by five major central banks to add liquidity to a European banking system struggling with its dollar funding needs.

By 3:10 a.m. ET, MSCI's benchmark global equities index was up 0.56 percent <.MIWD00000PUS> adding to gains of 1.2 percent on Thursday. Europe's FTSE Eurofirst index of top shares rose for the fourth straight session, up 0.6 percent soon after opening.

Stock markets in the UK <.FTSE>, France <.CAC40> Spain <.IBEX> and Italy <.MIB> jumped over 1 percent while Germany's DAX <.GDAXI> was up 1.8 percent.

Banks featured among the top gainers, with Societe Generale up 4.2 percent and Deutsche Bank up 4.5 percent.

There is a no doubt that the developments reached overnight are positive for markets as it addresses a liquidity issue that had begun to creep into European banks,said Ben Potter, strategist at IG Markets in London.

There was a lack of confidence beginning to build in the European inter-bank lending markets and these U.S. dollar funding lines will help ease these confidence issues.

U.S. Treasury Secretary Timothy Geithner holds talks with European finance ministers in Poland on Friday on the possibility of leveraging the euro zone's bailout fund to help resolve the debt crisis.

Investors are hoping the meeting will yield a more decisive result that will stave off a Greek default.

The liquidity issues have been fixed in the short term, but it doesn't change Greece's solvency issues, Fabrice Cousté, head of CMC Markets France, said.

Despite four days of stock market gains the world index is down 3.4 percent this month and has lost almost 10 percent so far in 2011 as fears of a global recession and euro zone problems keep a lid on risk appetite.

U.S. growth also remains firmly in focus, with weak factory and job data on Thursday bolstering the case for more action to support growth.

On currency markets, the euro was last down 0.5 percent at $1.3800, off a one-week peak of $1.3937 hit on Thursday but well above a seven-month trough below $1.35 plumbed on Monday. The common currency has bounced some 2 percent so far this week.

Earlier in Asia, equities enjoyed strong rallies, with Japan's Nikkei closing up 2.3 percent <.N225>, taking heart from the S&P 500 <.SPX> closing above the 1200 level, which had proved to be a stiff resistance over the past two weeks.

U.S. Treasuries steadied after 10-year yields hit two-week highs of 2.12 percent on Thursday. By 0710 GMT the yield stood at 2.08 percent.

Thursday's weak data has added to the case for the Federal Reserve to announce help for the U.S. economy next week, potentially including an increase in purchases of longer-dated Treasuries.

The central banks' coordinated action boosted commodity markets as well, with oil futures rising 50 cents a barrel to around $112.8. Stock gains and the improved risk appetite hit gold however, with prices for the metal losing 1 percent and heading for the biggest weekly drop since March 2009.

(Additional reporting by Nia Williams in London and Blaise Robinson in Paris; editing by Patrick Graham)