Asian share markets made guarded gains on Friday and the dollar held firm in the wake of reassuringly upbeat US retail data, though the mood was cautious as Greek debt talks took yet another confusing turn.

Activity was sparse with MSCI’s index of Asia-Pacific shares outside Japan up 0.3 per cent, but only just above three-month lows.

Japan’s Nikkei barely budged, though it found some support in a dollar bounce against the yen. Shanghai shares started higher but soon went flat.

Wall Street

The gains followed a slightly firmer close on Wall Street with the Dow up 0.22 per cent, while the S&P 500 added 0.17 per cent and the Nasdaq 0.11 per cent.

Sentiment was bolstered by a solid rise in US retail sales which, combined with upward revisions, suggested the economy was warming nicely after a chilly start to the year.

Fed rate hike

If the momentum is sustained, the Federal Reserve could begin to hike interest rates later in the year, with September increasingly seen by markets as the lift-off date.

All of which sets the scene for the Fed’s meeting on June 16 and 17 will include a news conference from Chair Janet Yellen.

Dollar index

The improving US data helped the dollar index up to 95.023, and away from a near one-month low of 94.322 set on Wednesday. Against the yen, the greenback bought 123.48 yen, well off this week's trough of 122.46.

Greece debt deal

The euro had less luck as talks on Greece showed no sign of reaching a deal. The single currency was off at $1.1254, from a high of $1.1387 set on Wednesday.

The dip followed the International Monetary Fund’s surprise decision to leave negotiations in Brussels and fly home because of major differences with Athens.

The move came as the European Union told Greek Prime Minister Alexis Tsipras to stop gambling with his country’s future and take crucial decisions needed to avert default.

Adding to the air of caution, German newspaper Bild reported Berlin was holding “concrete consultations’’ on what to do in the case of a bankruptcy of the Greek state, citing several people familiar with the matter.

This includes discussions about introducing capital controls in Greece if the crisis-stricken country goes bankrupt.

Crude oil

In commodity markets, oil prices dipped after Saudi Arabia said it was ready to raise output further to meet strong demand.

Brent crude oil for July fell 21 cents to $64.90 a barrel, while US crude lost 25 cents to $60.52.

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