European Central Bank to take action? Global markets wait and hope.

Hopes that European Central Bank president Mario Draghi will unveil a package of measures to ease the strains in Europe's debt crisis helped markets rally strongly Thursday.

Stocks, as well as the euro and the price of oil, have generally enjoyed a bumper six weeks or so after Draghi said the ECB would do "whatever it takes" to save the euro. Details of a new firefighting package are expected to be revealed later after the ECB's monthly policy decision and markets are in fairly buoyant mood.

"Investors may be bullish this morning in the run-up to the ECB press conference, but as ever, the devil is in the detail, and if Draghi does not add some color to the widely anticipated bond-purchasing program, investors will once again be seen heading for the hills," said Mike McCudden, head of derivatives at Interactive Investor.

In Europe, Germany's DAX was up 1.4 percent at 7,063 while the CAC-40 in France rose 1.2 percent to 3,448. The FTSE 100 index of leading British shares was 0.8 percent higher at 5,702.

The euro was also on the advance, trading 0.2 percent higher at $1.2618.

The key expectation in the markets is that Draghi will confirm that the centerpiece of the new package will be a commitment to buy unlimited amounts of short-term bonds of those countries that first ask for help from the European emergency bailout funds.

This should help keep the lid on the short-term borrowing rates of countries like Italy and Spain, giving them time to enact austerity measures as well as economic reforms.

However, investors remain wary especially after Draghi failed to match expectations following last month's rate-setting meeting.

And many analysts remain skeptical that the approach will work in the long-run given that there will be strict conditions on countries that have their bond purchased. In addition, the ECB is likely to insist that any purchases are offset by the sale of financial assets elsewhere.

"In essence it seems like a short-dated variation of the previous program, but on steroids, and that wasn't exactly a resounding success," said Michael Hewson, markets analyst at CMC Markets.

As well as keeping a close watch on developments in Europe, investors have one eye on a raft of U.S. economic data ahead of Friday's closely watched nonfarm payrolls report for August.

The payrolls figure often set the market tone for the following couple of weeks their release. This month, the reaction could be even bigger as the figures could cement expectations, one way or another, over whether the U.S. Federal Reserve will enact another monetary stimulus.

Wall Street was poised for a solid opening, with Dow futures up 0.5 percent and the broader S&P 500 futures 0.7 percent higher.

Earlier, stock markets in Asia wavered before posting modest gains.

Japan's Nikkei 225 closed marginally higher at 8,680.57. Hong Kong's Hang Seng added 0.3 percent to 19,209.30. South Korea's Kospi gained 0.4 percent to 1,881.24, boosted by tech shares.

Mainland China's Shanghai Composite Index rose 0.7 percent to 2,051.92 while the smaller Shenzhen Composite Index added 1 percent to 859.30.

Oil prices tracked equities higher amid hopes over the ECB — benchmark oil for October delivery was up $1.16 to $96.52 a barrel in electronic trading on the New York Mercantile Exchange.