GLOBAL MARKETS-Asia shares rally on vaccine hopes, oil retreats after early gains

* Asian stock markets:

* MSCI ex-Japan jumps to highest since May 1

* Euro hovers near 2-week highs, yen weakens against dollar

* Coronavirus vaccine trial success sparks rally

* Oil retreats from 2-month high

SYDNEY/HONG KONG, May 19 (Reuters) - Asian shares extended gains on Tuesday as more countries emerged from their economic lockdowns and a successful early-stage trial of a coronavirus vaccine cheered sentiment, although oil shed some of its early moves higher.

The rally followed a firmer Wall Street lead after data from Moderna Inc’s COVID-19 vaccine, the first to be tested in the United States, showed it produced protective antibodies in a small group of healthy volunteers.

The positive early test results boosted sentiment as investors wagered on a faster-than-expected economic recovery.

Many economies could post strong activity data from May as a result of easing restrictions, but the initial burst may give market participants a false sense of a return to normal, CBA said in a research note.

“We also expect economic recoveries to be uneven,” it said in its global markets research note. “An economy would still be in a very deep recession even if economic activity is able to quickly return to 95% of ‘normal’ levels.”

S&P 500 futures fell 0.03%, while European markets were set to open higher with the pan-region Euro Stoxx 50 futures up 0.24% and German DAX futures trading 0.29% higher.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 1.8% to two-week highs, after U.S. stocks ended the previous session with gains. The index is, however, down 1.9% so far this month.

Australia’s benchmark index and Hong Kong’s Hang Sang were the lead gainers, up 2% each, South Korea added 2.3% while China’s blue-chip index climbed 0.8%.

Japan’s Nikkei added nearly 2% to the highest since early March.

On Wall Street overnight, the benchmark S&P 500 posted its biggest one-day percentage gain in almost six weeks, gaining 3.15%. The Dow Jones Industrial Average rose 3.85% and the Nasdaq Composite added 2.44%.

However, analysts, for now, expect a steep contraction in world growth with the outlook for 2021 still uncertain with no approved treatments or vaccines for COVID-19 currently. Experts predict a safe and effective vaccine could take 12 to 18 months.

“It may be the case that central bank liquidity is chloroforming markets to overlook risks such as overleveraged corporate and government balance sheets, growing COVID-19 case numbers, growth holes and a slow recovery path,” analysts at Perpetual wrote in a note.

The vaccine optimism sent treasury yields surging overnight as investors dumped bonds, while gold came off its peak. Spot gold was traded at $1,735.8486 per ounce.

Oil prices were mixed on Tuesday, with profit-taking paring Brent’s early gains, while U.S. crude extended its rally amid signs producers are cutting output as promised just as demand picks up.

Brent crude fell 19 cents, or 0.6%, to $34.62 a barrel, after earlier touching its highest since April 9.

There was some good news in Europe, after France and Germany called for the creation of a 500 billion euro ($543 billion) Recovery Fund able to offer grants to the countries and regions hardest hit by the coronavirus crisis.

The euro hovered near a two-week top at $1.0907. The British pound was up 0.1% at $1.2201. The risk-sensitive Australian and New Zealand dollars also rose slightly.

The safe-haven yen eased on the greenback to 107.38 per dollar.

Additional reporting by Chris Prentice in Washington; Editing by Sam Holmes and Lincoln Feast.