LONDON - Global stocks and commodity markets extended a tentative recovery from their coronavirus slump on Tuesday, as global policymakers signaled a united front to address the economic fallout from the spreading outbreak.

Europe’s main bourses climbed 2 percent or more in early trade in London, Frankfurt, Paris and Milan. MSCI’s world stocks index rose 0.5 percent.

The improved sentiment helped US S&P 500 futures climb up as much as 1 percent in Asian trade on Tuesday but they trimmed gains to 0.1 percent following reports on the G7 draft statement lacking firm or immediate commitments.

MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.8 percent higher, off earlier highs but still marking the second straight session of rises.

Japan’s Nikkei lost steam and closed 1.2 percent lower after short-covering ran its course and as the yen firmed on the dollar, but South Korea’s Kospi rose 0.6 percent.

Australian shares ended up 0.7 percent after the central bank cut interest rates to a record low of 0.5 percent, the fourth reduction in less than a year.

Money markets are fully pricing in a cut of at least 0.25 percentage point to the current 1.50-1.75 percent target rate at the Fed’s March 17-18 meeting as well as a 0.10 percentage point cut to the ECB’s key rate at March 12 meeting.

US bond yields roll back some of their sharp falls.

The 10-year US Treasuries yield moved to 1.1174 percent from a record low of 1.030 percent marked on Monday. The rate-sensitive two-year notes yield jumped back to 0.8452 percent from Monday’s 3 1/2-year low of 0.710 percent.

April Fed funds rate futures still price in about 80 percent chance of a 0.50 percentage point cut this month and a total of almost 1 percentage point cuts by the end of year.

Expectations of Fed rate cuts prompted investors to cut dollar exposure.

Against the yen, the dollar lost 0.5 percent to 107.8 yen, slipping towards a five-month low of 107 set on Monday.

The euro was a shade higher at US$1.1146, having hit an eight-week peak of US$1.1185 in the previous session.

The Australian dollar sat above a recent 11-year trough largely on short covering after the cut in interest rates.

Oil prices gained another 2 percent after a jump of more than 4 percent on Monday. US West Texas Intermediate crude futures to US$47.8 a barrel while Brent crude stood at US$52.9.