* Europe shares follow Asia higher, Tokyo up 8 percent
* Wall Street set for modestly higher open
* Dollar strengthens against yen, euro
* German debt auction uncovered, U.S. sale eyed
* Oil dips on oversupply, gold steady
By Nigel Stephenson
LONDON, Sept 9 (Reuters) - Global shares rose on Wednesday, led by an 8 percent surge in Japanese stocks, helping lift the dollar as the prospect of more economic stimulus from China soothed investors rattled by recent market turmoil.
The charge into stocks pushed yields on low-risk government bonds higher, though a sale of German 10-year debt attracted bids worth less than the amount on offer. The U.S. Treasury is scheduled to auction $21 billion of 10-year paper later.
Oil prices gave up early gains on concern about oversupply.
European shares followed Asia higher. The pan-European FTSEurofirst 300 index .FTEU3 rose 2.4 percent to a two-week high, led by miners tracking a sharp rise in metals prices on expectations of more stimulus in top consumer China.
U.S. index futures ESc1 SPc1 suggested Wall Street would open up about 1 percent.
The stock market gains were sparked by a rally in Chinese shares on Tuesday, when weaker-than-expected August trade reinforced investors' expectations that Beijing would act to bolster slowing growth in the world's second-largest economy.
China's Finance Ministry said on Wednesday it would strengthen fiscal policy, boost infrastructure spending and speed up tax reform, helping lift Chinese shares for a second day. The Shanghai Composite .SSEC closed 2.3 percent higher and the CSI 300 index .CSI300 rose 1.96 percent while Hong Kong's Hang Seng .HSI was up 4.5 percent.
Angus Gluskie, managing director of White Funds Management in Sydney, described Wednesday's stock rally as a "speculative bounce".
"The market will remain susceptible to a return of negativity until we see signs of some improvement in the original causes of weakness, which were predominantly Chinese growth concerns," he said.
Signals from Prime Minister Shinzo Abe that Japan will cut corporate taxes pushed the Nikkei 225 .N225 stock index up 7.7 percent, the most it has risen in a day since the depths of the global financial crisis in October 2008. ID:nL4N11D3H5
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS also rallied strongly, rising 3.3 percent, with gains across all the major indices.
Investors' increased appetite for risk saw the dollar firm against the safe-haven yen and the euro. The single European currency EUR= was down 0.5 percent at $1.1142 while the yen was 0.9 percent weaker at 120.85 per dollar.
The dollar index .DXY , which measures the greenback against a basket of six major currencies, was up 0.4 percent.
"In the short term, U.S.-German rate spreads are pushing back to their widest of the year and could start to weigh on the euro," said Chris Turner, head of currency strategy at ING.
"At the same time if there is, albeit temporarily, a recovery in the risk environment we should see a return of euro-funded trades."
Brent, the global benchmark LCOc1 for crude oil, was down 80 cents at $47.82 a barrel.
"The oil market is still oversupplied," said Tamas Varga of PVM.
German 10-year bond yields DE10YT=TWEB rose 1 basis point to 0.69 percent. Germany sold 3.2 billion euros of the paper at an average yield of 0.69 percent, attracting bids worth less than the 4 billion on offer. ID:nZYN0MJL86
U.S. 10-year Treasury yields US10YT=RR also rose and were last up 3.4 bps at 2.23 percent, their highest since Aug. 10.
"The environment for the auctions seems tricky amid the ongoing concerns about Chinese selling (of Treasuries). No one really knows how Chinese demand is going to behave, and that's creating uncertainty here," said Commerzbank (XETRA:CBKG) strategist Michael Leister.
Copper CMCU3 hit a seven-week high above $5,400 a tonne.
Gold XAU= held above a three-week low, last trading at $1,119.38 an ounce, having fallen as low at $1,116.20 earlier this week.