World shares hovered near record highs on Thursday after downbeat Chinese manufacturing data put pressure on Beijing for more stimulus and the Federal Reserve signalled an increase in US interest rates is still some way off.

European markets opened largely subdued, however, as disappointing German purchasing manager data (PMI) offset an improvement in France. That left the region’s main bourses down as much as 0.6 per cent and investors preferring bonds.

Cash-for-reforms deal

The euro gained to $1.1150. Top euro zone leaders will meet later in Latvia, where Greek premier Alexis Tsipras hopes the broad outline of a cash-for-reforms deal will be accepted, staving off a default.

Worries over Athens’ finances have escalated this year as the country’s new government has pushed back on austerity imposed as part of its bailout packages.

“I think it is coming to a head,’’ said Alvin Tan, a currency strategist at Societe Generale in London.

“It looks like it will be difficult for Greece to make it through June without a new cash disbursement, so I think we are coming to the point where a deal is needed very soon, probably within the next two weeks.’’

Fed policy minutes

The dollar lost ground as minutes from the Federal Reserve’s April meeting bolstered the view that the Fed is not ready to raise US rates. Its policymakers thought a move in June would be premature, leading traders to push back expectations for a rate increase to the turn of the year.

The European Central Bank, which recently started a 1 trillion-euro stimulus programme, will release the minutes of its most recent meeting at 1130 GMT. The meeting was held before this month’s bond sell-off, so the main focus is likely to be whether the ECB is concerned about funding Greece’s banks.

Asia-Pacific shares

MSCI’s broadest index of Asia-Pacific shares outside Japan ended little changed in Asian trading. South Korean, Hong Kong and Malaysian shares slipped, while Australian stocks jumped on bargain hunting and emerging Asian currencies took advantage of the softer dollar.

Tokyo’s Nikkei ended almost flat after touching a 15-year high. High-flying Chinese shares climbed another 1.2 per cent as the third straight monthly contraction in Chinese factory activity bolstered stimulus bets.

“Under the current environment, any excuse seems good enough to cause a rally,’’ wrote Gerry Alfonso, director of Shenwan Hongyuan Securities Co in Shanghai.

Euro zone bond yields

The recent surge in euro zone bond yields has stalled this week, partly in response to ECB policymakers saying the central bank would ramp up its bond buying for the next two months.

German 10-year yields, the benchmark for euro zone borrowing costs, were 1 basis point lower on Thursday at 0.62 per cent, down from 2015 highs of 0.80 per cent reached earlier this month. Italian, Spanish and Portuguese 10-year yields were 3-4 bps lower at 1.82 per cent, 1.76 per cent and 2.40 per cent, respectively.

In commodities, US crude rose 17 cents to $59.15 a barrel as a rebound following days of losses continued. Oil prices had bounced on Wednesday after a five-day decline, but a large supply overhang and concerns over a strong dollar capped gains.

Hopes of future China stimulus helped lift copper of three-week low. Gold held in a range near $1,200 an ounce.

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