By Hideyuki Sano
TOKYO (Reuters) - Asian shares look set to extend their recovery from 12-week lows on Thursday after renewed optimism on European banks' prospects and a rise in oil prices to near $50 a barrel helped lift global shares.
Australian share futures rose 0.6 percent overnight, while U.S.-traded Nikkei futures <0#NIY:> point to a gain of 1.0 percent in Japanese shares.
MSCI's broadest index of Asia-Pacific shares outside Japan looks set to extend its rebound from Tuesday's 12-week low, after having risen 1.2 percent on Wednesday.
Share prices have risen solidly since Tuesday, with MSCI's broadest gauge covering 46 markets rising 1.97 percent in the last two days to a three-week high.
European banks were leading the gains with rise of 6.8 percent in the last two sessions, benefiting from a decision by euro zone finance ministers to unlock new funds for Greece and to give it a firm offer of debt relief.
On Wall Street, U.S. S&P 500 Index rose to 2,091, highest in almost a month and near its six-month intraday high of 2,111.
Energy stocks outperformed on the back of continued recovery in oil prices, which hit seven-month highs after the U.S. government reported a larger-than-expected drop in crude inventories. [O/R]
Global benchmark Brent futures rose to as high as $49.96 per barrel, the highest level since early November, and last stood at $49.78.
U.S. West Texas Intermediate (WTI) hit $49.75, a seven-month high.
The rally in risk assets came even as investors readied themselves for monetary tightening by the U.S. Federal Reserve as early as next month.
The yield on two-year U.S. notes rose to a 10-week high of 0.938 percent as investors priced in the likelihood of the Fed raising its federal funds target rate to 0.50-0.75 percent from the current 0.25-0.50 percent in coming months.
Earlier this month, the two-year yield fell to as low as 0.686 percent.
For now, market players will be looking to comments by Fed Chair Janet Yellen at a Harvard University event on Friday, though many also say her speech scheduled for June 6 - after new U.S. payrolls data comes out - would be even more crucial.
U.S. interest rate futures <0#FF:> are pricing in about one-third chance of a rate hike in June and about 60 percent likelihood by July.
The prospects of higher U.S. interest rates undermined the attraction of gold, which fell to a seven-week low of $1,217.90 per ounce and last stood at $1,222.40.
In the currencies, sterling rose to $1.4700, near its four-month peak of $1.4770 hit earlier this month, as several bookmakers widened the odds on a British "Brexit" from the European Union after opinion polls showing the "in" camp leading. [GBP/]
The dollar was supported by U.S. rate hike expectations, while the euro stood at $.1151, having hit a 10-week low of $1.1129 overnight.
The dollar fetched 110.19 yen, edging nearer a three-week high of 110.59 hit last week.
(Reporting by Hideyuki Sano; Editing by Eric Meijer)