Asian shares were led higher by S&P 500 futures on Monday and oil prices hit a five-week peak as countries’ efforts to re-open their economies stirred 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 U.S. 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 U.S. economic recovery may stretch deep into next year and a full comeback might depend on a coronavirus vaccine.
Late Sunday, Powell outlined the likely need for three to six more months of government financial help for firms and families.
Data out on Friday showed retail sales and industrial production both plunged in April, putting the U.S. economy on track for its deepest contraction since the Great Depression.