Asian shares rose on Tuesday after Greece's latest budget proposals raised hopes it would stave off a debt default and reach a deal with lenders later this week. The brighter mood was expected to extend into many European markets even as some strategists remained sceptical. Financial spreadbetters predicted Germany's DAX .GDAXI to gain as much as 0.7 percent, and France's CAC 40 .FCHI 0.6 percent. But Britain's FTSE 100 .FTSE was called to open 6 points lower, or down 0.05 percent. "While it would appear that the Greek government has shifted some ground towards the creditors, the measures put forward yesterday appear to differ little from the same failed policies that have brought Greece to the situation where we are today," said Michael Hewson, chief markets analyst at CMC Markets. "That's not really something worth celebrating," Hewson said in a note to clients. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up 0.6 percent, while Japan's Nikkei share average .N225 jumped 1.9 percent to a fresh 15-year high as investors bought back some of the shares they unloaded over three losing weeks. "The fact that it appears that something will happen for Greece is really lifting the market's mood," said Ayako Sera, senior market economist at Sumitomo Mitsui Trust Bank in Tokyo. "But these moves up are not based on fundamentals. The upside is likely to be heavy, as concerns about global growth remain," she said. U.S. stock futures ESc1 rose about 0.3 percent after Wall Street posted solid gains on Monday, with the Nasdaq Composite .IXIC closing at a record high. European Council President Donald Tusk called the Greek proposals "a positive step forward," and said the aim was to have Eurogroup finance ministers approve a cash-for-reform package on Wednesday evening, and put it to euro zone leaders for final endorsement on Thursday morning. Stocks gained even as upbeat U.S. data backed the view that the U.S. Federal Reserve is on track to raise interest rates as early as September. The National Association of Realtors said existing home sales rose to their highest in five-and-a-half years, increasing 5.1 percent to an annual rate of 5.35 million units, and adding to evidence that U.S. economic momentum picked up in the second quarter after a sluggish start to the year. The euro EUR= skidded 0.6 percent to $1.1279, moving away from a one-month high of $1.1440 hit on Thursday as some cautioned that steps in a positive direction did not guarantee an eventual solution to Greece's debt crisis. "Although momentum appears to have turned positive, if there is no progress on negotiations for a program extension before the 30 June deadline, the ECB may have to increase haircuts on Greek assets, which could, in turn, precipitate the need for capital controls," strategists at Barclays said. The dollar rose about 0.3 percent on the day against the yen to 123.69 JPY=, though it remained well below a 13-year high of 125.86 yen hit earlier this month. Yields on U.S. Treasuries rose in line with lower demand for safe-haven fixed income assets, and expectations of higher U.S. interest rates this year also weighed on U.S. debt prices. The benchmark U.S. 10-year note yield US10YT=RR was last at 2.381 percent, up from its U.S. close of 2.362 percent. CHINA VOLATILE Chinese shares pulled out of negative territory it had sunk into after an early rally unraveled. Investors initially took heart from a gauge of Chinese factory activity that suggested signs of stabilization, though it also included some worrying signals. The HSBC/Markit Flash China Manufacturing Purchasing Managers' Index (PMI) edged up to 49.6, a three-month high, from 49.2. But it remained below the 50 mark which separates contraction from expansion and still implied that Beijing might need to muster more stimulus measures. "On one hand, the sector shows signs of improvement as output stabilized amid a slight pick up in total new work, while purchasing activity also rose slightly over the month," said Annabel Fiddes, an economist at Markit. "On the other hand, manufacturers continued to cut staff. This suggests companies have relatively muted growth expectations," she said. Chinese stocks resumed trading after a public holiday on Monday, with the CSI300 index .CSI300 of the largest listed companies in Shanghai and Shenzhen last up 1.8 percent in volatile trade, while the Shanghai Composite Index .SSEC rose 0.7 percent. Both had plunged more than 13 percent last week. In commodities trading, U.S. crude futures CLc1 slipped about 0.1 percent to $60.30 a barrel on renewed concerns of a global oil glut, although a forecast for a drop in U.S. domestic crude stocks put a floor under prices. Brent crude LCOc1 was down slightly on the day at $63.32. Source: Reuters
