Asia shares edge up, Greece uncertainty lingers

By Wayne Cole

SYDNEY (Reuters) – Most Asian share markets were fractionally higher on Monday following a record close on Wall Street, with investors cautiously optimistic the European Union would make progress this week on a debt deal with Greece.

Oil prices extended their bounce as Brent topped $ 62 a barrel, while the major currencies stayed locked in recent tight ranges.

Data from Japan showed the economy emerged from recession in the final quarter of last year, though growth of 0.6 percent was short of market forecasts.

Investors still seemed encouraged and the Nikkei <.N225> firmed 0.6 percent in early trade.

MSCI’s broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> recouped a small initial loss to inch ahead.

The index boasted its highest close since late October on Friday but is bumping up against a major band of chart resistance in the 484 to 486 area.

Australia’s main index <.AXJO> eased 0.2 percent, while South Korean shares <.KOSPI> rose by a matching amount.

Holidays will be a feature this week with the United States off on Monday and much of Asia celebrating the Lunar New Year. China’s markets are off from Feb. 18 right through to the 24th.

The Eurogroup of finance ministers meets in Brussels later Monday to try to find common ground with Greece’ new government, in talks that could drag on for some time.

Greece said on Sunday it was confident of reaching agreement in negotiations with its euro zone partners, but reiterated it would not accept harsh austerity strings in any debt pact.

Markets have generally assumed a compromise would eventually be found, given the alternative might be a disastrous Greek exit from the euro.

The S&P 500 ended at a record high on Friday, as energy shares gained with oil prices, while the Nasdaq hit a 15-year high helped by technology stocks.

The Dow <.DJI> gained 0.26 percent, while the S&P 500 <.SPX> added 0.41 percent and the Nasdaq <.IXIC> 0.75 percent. The FTSEuroFirst index of 300 leading shares <.FTEU3> closed up 0.64 percent, helped by upbeat growth data from Germany.

Without a clear outcome on Greece, there is little conviction to buy or sell the euro. As a result, the common currency has been drifting in a slim $ 1.1262-1.1534 range in the last few weeks. It was last flat at $ 1.1400 .

Against the yen, the euro was a touch softer at 135.00 , off a three-week peak of 136.70 reached last Thursday. The dollar slipped to 118.59 yen , recoiling from a one-month high of 120.48 set last Wednesday.

The main mover on Monday was sterling, which scaled a six-week peak following recent hawkish-sounding comments from the Bank of England. The pound climbed as far as $ 1.5435 in early trade, from around $ 1.5407 late on Friday.

In commodities, oil was supported by signs that deeper industry spending cuts may curb excess supply. Brent crude rose 42 cents to $ 61.94 per barrel, while U.S. crude added 34 cents to $ 53.12 per barrel.