European stock indexes have risen, extending a recovery from the previous day as fears about a banking crisis eased slightly after top US authorities and banks took action to rescue First Republic Bank.

In a crisis beginning with the collapse of US-based Silicon Valley Bank last Friday, risk appetite plunged earlier in the week as investors lost confidence in regional banks in the US and Credit Suisse in Europe.

The tumultuous week saw bond yields plunge as investors lowered their expectations for future rate rises.

Global markets stabilised somewhat on Thursday, helped by Credit Suisse saying it would borrow up to 50 billion Swiss francs ($A81 billion) from the Swiss National Bank and, later in the day, a group of major banks injecting $US30 billion ($A45 billion) in deposits into First Republic Bank, a mid-sized US lender.

Still, analysts say the worry about a possible banking crisis is far from over.

Credit Suisse's chief executive said on Friday the bank was working hard to stem customers outflows, although this could take time.

At 0944 GMT, the MSCI world equity index, which tracks shares in 47 countries, was up 0.4 per cent on the day.

Europe's STOXX 600 was up 0.7 per cent, but still down 1.9 per cent on the week overall.

London's FTSE 100 was up 0.9 per cent.

The US two-year Treasury yield, which is the most sensitive to shifts in interest rate expectations, was up two basis points on the day at 4.1384 per cent - still closer to Wednesday's six-month low of 3.72 per cent than the peak of 5.084 per cent it hit the previous week, which had been its highest since 2007.

The European Central Bank raised rates by 50 bps on Thursday, sticking to its pledge to fight inflation even as some investors called for a pause in the rate-hiking cycle until the banking turmoil eases.

The central bank's supervisory board met on Friday to discuss stress and vulnerabilities in the euro zone banking sector.

The benchmark German 10-year yield was steady at about 2.255 per cent and short-dated euro zone government bond yields rose.

Markets are pricing in a 25 bps increase by the US Federal Reserve when it meets next week, down from previous expectations for a 50 bps increase.

Fed data on Thursday showed that banks sought record amounts of emergency liquidity in recent days, which in turn helped undo months of central bank effort to shrink the size of its balance sheet.

"The fact that the Fed has been very proactive in terms of opening the liquidity tap is potentially useful and that's stabilised things in the short term at least," said Guillaume Paillat, multi-asset portfolio manager at Aviva Investors.

"It's potentially a more stable environment, because it feels like we've passed the crisis point and things should normalise a bit."

Against a basket of currencies, the US dollar was down 0.3 per cent.

The Australian dollar, seen as a liquid proxy for risk appetite, was up 0.7 per cent on the day at $US0.6705 ($A1.0021).

The British pound was up 0.2 per cent and the euro was up 0.3 per cent.

Oil prices also benefited from the resurgence of risk appetite, with Brent crude futures up 1.2 per cent and US West Texas Intermediate crude up 1.5 per cent, recovering after having hit their lowest in more than a year earlier in the week.