Asia stocks, euro falter as Greek talks keep investors on edge

Creditors said that more work is needed for a cash-for-reform deal

Asian stocks edged lower and the euro sagged on Tuesday as insufficient progress on talks between debt-strapped Greece and its creditors kept investors on edge.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.1%. Japan's Nikkei lost 0.3% and South Korea's Kospi dipped 0.1%.

In a closely-watched Eurogroup meeting on Monday, euro zone finance ministers welcomed progress in negotiations between Greece and its creditors but said more work is needed for a cash-for-reform deal.

"It acknowledged progress, but any further development will depend on a positive conclusion to a review of the current programme. In other words, the story remains unchanged," Richard Cochinos, head of Americas G10 FX strategy at Citi, wrote in a note to clients.

While Greece said on Monday it repaid about 750 million euros to the International Monetary Fund, the absence of a clear breakthrough in negotiations made it an anxious wait for markets worried that Athens would eventually run out of cash and default on its debts.

"Barring an unforeseen shock, Greece should be able to carry on negotiations into June, but cash positions are low. Based on our expectations debts will have significant trouble being met beyond mid-June," Cochinos at Citi said.

Wall Street shares slipped after the Eurogroup meeting, with the Dow and S&P 500 shedding 0.5% each.

Meanwhile, China continued to be on investors' radar after Beijing cut interest rates for the third time in six months on Sunday. While the latest easings have generally been welcomed by global investors, concerns remain about the outlook for the world's second-largest economy as it heads for its worst year in a quarter of a century.

In currencies, the euro was down 0.1% at $1.1140 . The common currency surged to a two-month high of $1.1392 on Thursday when markets were focussed on improving prospects for the European economy and surging euro zone bond yields.

The dollar was little changed at 120.14 yen after climbing modestly overnight as US Treasury yields rose ahead of $64 billion in new debt supply hitting the market this week.

The New Zealand dollar, battered recently by increasing speculation that the country's central bank would eventually cut rates, hovered near a two-month low of $0.7333 .

In commodities, US crude lost 2 cents to $59.23 a barrel on signs of rejuvenation in already bloated US shale supplies.