SYDNEY, May 18 — Asian shares crept ahead today and oil prices hit a five-week high as more countries re-opened their economies, stirring hopes the world was nearer to emerging from recession.

Summer weather is enticing much of the world to emerge from coronavirus lockdowns as centres of the outbreak from New York to Italy and Spain gradually lift restrictions that have kept millions cooped up for months.

"The economies of Europe and the US likely bottomed out in April and are slowly starting to come back to life,” wrote Barclays economist Christian Keller in a note.

"However, incoming data from most economies highlight the depth of the contraction, raising risks of longer-term scarring that might undermine the recovery.”

Federal Reserve Chairman Jerome Powell took a cautious line in an interview over the weekend saying a US economic recovery may stretch deep into next year and a full comeback might depend on a coronavirus vaccine.

Late yesterday, Powell outlined the likely need for three to six more months of government financial help for firms and families.

Data out on Friday had shown retail sales and industrial production both plunged in April, putting the US economy on track for its deepest contraction since the Great Depression.

Closer to home, data in Japan showed the world’s third-largest economy slipped into recession in the first quarter, putting it on course for its worst postwar slump as the coronavirus takes a heavy toll.

Adding to the uncertainty were the trade tensions between the United States and China, with Beijing warning it was opposed to the latest rules against Huawei.

All of which made for a guarded mood and MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.1 per cent in early trade. Japan’s Nikkei rose 0.2 per cent and South Korean stocks 0.1 per cent.

E-Mini futures for the S&P 500 added 0.7 per cent, though results from a raft of US retailers this week are likely to make grim reading.

Dealers reported much chatter about a possible treatment for Covid-19 from drug maker Sorrento Therapeutics, which saw its shares soar on Friday.

Another focus will be the US Treasury Department’s first auction for its 20-year bond on Wednesday. Treasury plans to borrow a record amount of nearly US$3 trillion this quarter.

So far, the market has easily absorbed the flood of new debt, with 10-year yields holding to a tight range around 0.64 per cent.

The dollar has also been largely range-bound, with its safe-haven appeal keeping it well supported overall. Against a basket of currencies, it was last at 100.38, having drifted 0.7 per cent higher last week.

The euro was steady at US$1.0820, while the dollar edged up 0.2 per cent on the Japanese yen to 107.25.

The pound touched a seven-week low at US$1.2073 after the chief economist of the Bank of England said the bank was looking more urgently at options such as negative interest rates and buying riskier assets to prop up the economy.

In commodity markets, the flood of liquidity from central banks combined with record-low interest rates to help lift gold to a seven-year peak. The metal was last up 1 per cent to US$1,758 an ounce.

Oil prices reached their highest since March on a pick-up in demand as countries around the world eased travel restrictions.

Brent crude futures firmed 96 cents to US$33.46 a barrel, while US crude rose 98 cents to US$30.41. — Reuters