Stock markets worldwide soared on Friday after China cut interest rates for the fourth time this year and several large-cap US technology companies reported better-than-expected quarterly results.

Shares across Asia, Europe and the Americas climbed, having already been boosted by Thursday's message from ECB chief Mario Draghi that the central bank was ready to adjust "the size, composition and duration" of its quantitative easing program.

Wall Street rallied, with the S&P 500 gaining 1 per cent to reach its highest since Aug. 20, which marked the beginning of a selloff initially sparked by weak data out of China.

Technology shares led the way, thanks to gains in Alphabet , Amazon and Microsoft, after the three companies reported earnings results. The former two hit record highs, while Microsoft rose to a 15-year high.

The Dow Jones industrial average rose 157.54 points, or 0.9 per cent, to 17,646.70, the S&P 500 gained 22.64 points, or 1.1 per cent, to 2,075.15 and the Nasdaq Composite added 111.81 points, or 2.27 per cent, to 5,031.86.

China, in a surprise move, cut its benchmark one-year lending rate by 25 basis points to 4.35 per cent and lowered big banks' reserve requirement ratio by 50 basis points to 17.5 per cent.

Long-dated government debt yields rose, as the gains in equities reduced the appeal of safe-haven bonds. China's rate cut did not move commodities investors to bid up oil prices, which were flat to lower.

In the currency markets, the offshore yuan sagged to its lowest in a month, while the euro fell to $1.10 to put the dollar on course for its biggest weekly rise against major currencies since late May.

Global bond investors backed off safe-haven debt in the US and Germany. Additional Chinese stimulus could help global growth, boosting yields on benchmark US Treasuries and European debt. The 10-year US Treasury note fell 17/32 in price to boost its yield to 2.091 per cent.

Separately, the prospect of more ECB stimulus by the end of the year saw Italian and Spanish two-year government bond yields both turn negative for the first time, meaning investors effectively pay to hold them rather than get paid.

Greece's bond curve was close to normalizing, having been distorted for months following its political crisis that saw it teeter on the brink of leaving the euro.

"Draghi has come out and kitchen-sinked the whole thing, everything is now on the table," said Gavin Friend, a strategist at National Australia Bank in London.

The FTSEurofirst rose 2 per cent and added to what will be a fourth straight week of gains for MSCI's 45-country All World index.

Brent fell 0.25 per cent to $47.96 a barrel, while US crude lost 1.6 per cent to $44.66. – Reuters