Stock markets mostly extended the solid start to the year Thursday as China reopens its economy from lockdowns, while oil prices recovered after heavy losses.

Markets tracked Wednesday's rally on Wall Street that came even as minutes from the Federal Reserve's December meeting showed officials lining up more hikes to US interest rates to fight decades-high inflation.

The upbeat mood has been boosted by signs that China is implementing policy changes to make it a more attractive location for investment.

A decision allowing Ant Group to raise $1.5 billion in funding was seen as an indication that authorities' long-running crackdown on the tech sector could be coming to an end.

Fresh measures to support the struggling property sector have also been unveiled.

Reports that Beijing was considering lifting a two-year ban on some imports of Australian coal, as well as a slight thawing of ties with Washington, were also providing some hope for the year ahead.

That all comes against the backdrop of a rollback of the country's strict zero-Covid policy, which had sapped economic growth since the start of the pandemic.

The move has fanned hopes that the world's second-largest economy will bounce back after three years of lockdowns and tough restrictions, though the surge in infections in recent weeks has also raised concerns about the near-term outlook.

"The medium-term prospects still appear quite bullish, especially if China can bounce back strongly later this year and fully transition to living with Covid, like much of the rest of the world," said analyst Craig Erlam at trading firm Oanda.

Crude prices jumped but were still well down on the week, as demand outlook remains weak owing to China's Covid crisis keeping people at home and Europe's mild winter lowering energy use.

In a sign that the energy crisis may be easing, natural gas prices in Europe are at their lowest levels since November 2021, wiping out the rises seen after Russia's invasion of Ukraine.

Traders are now awaiting the release of US jobs data at the end of the week, which will give the latest snapshot of the world's top economy after almost a year of Fed rate hikes and surging inflation.

The Fed minutes released Wednesday showed officials intend to keep hiking rates and would not ease policy until prices are under control, keeping traders on edge that the central bank will tip the economy into recession.

"However, we must remember that the Fed also did not forecast raising rates by 400 basis points twelve months ago, so their forecasting ability" raises questions, said Joe Gilbert at Integrity Asset Management.

- Key figures around 1200 GMT -

London - FTSE 100: UP 0.4 percent at 7,616.90 points

Frankfurt - DAX: FLAT at 14,491.43

Paris - CAC 40: FLAT at 6,775.38

EURO STOXX 50: DOWN 0.1 percent at 3,971.16

Tokyo - Nikkei 225: UP 0.4 percent at 25,820.80 (close)

Hong Kong - Hang Seng Index: UP 1.3 percent at 21,052.17 (close)

Shanghai - Composite: UP 1.0 percent at 3,155.22 (close)

New York - Dow: UP 0.4 percent at 33,269.77 (close)

Brent North Sea crude: UP 2.2 percent at $79.57 per barrel

West Texas Intermediate: UP 2.2 percent at $74.44 per barrel

Euro/dollar: UP at $1.0613 from $1.0611 Wednesday

Pound/dollar: DOWN at $1.2019 from $1.2055

Euro/pound: UP at 88.27 pence from 87.94 pence

Dollar/yen: DOWN at 132.48 yen from 132.67 yen