By Wayne Cole
SYDNEY (Reuters) - Asian stock markets turned cautious on Wednesday while the U.S. dollar crept higher as looming euro zone meetings to discuss the Greek debt crisis threatened to produce more confusion than clarity.
Euro zone finance ministers meet later on Wednesday and EU leaders on Thursday, but officials are already downplaying the chance of a breakthrough.
Moves were minor with trade thinned by a holiday in Tokyo, leaving MSCI's broadest index of Asia-Pacific shares outside Japan off a slight 0.2 percent.
Shares in Shanghai edged up 0.2 percent as pressure grew for more economic stimulus after a very low reading on inflation stirred fears of deflation.
China's central bank on Tuesday said it was ready to fight a downturn, while not taking excessive risks with credit creation.
Australia's main index slipped 0.6 percent even as a survey showing consumer confidence had surged to 13-month peaks in the wake of last week's cut in domestic interest rates.
The Dow had ended up 0.79 percent, while the S&P 500 gained 1.07 percent and the Nasdaq 1.3 percent.
S&P futures pointed to a slightly weaker opening on Wall Street later in the day.
Apple Inc became the first U.S. company worth more than $700 billion as its shares rose 1.9 percent after it priced Swiss franc bonds.
Microsoft also priced a new issue of bonds that starkly illustrated the desperate search for yield among investors in a low-inflation world.
The tech giant's sale of $10.75 billion of debt was easily its largest ever, but drew orders for no less than $39 billion. Among the six tranches on offer, it was able to borrow money for 40 years at just 4 percent.
Treasuries had a tougher time amid growing talk the Federal Reserve could start raising interest rates by mid-year.
Yields on 10-year notes were hovering at 1.99 percent having touched a four-week peak of 2.016 percent.
The rise in yields helped the dollar tick up to a one-month high at 119.63 yen, while the dollar index held steady at 94.769.
The euro struggled to find any direction amid all the brinkmanship over Greece and last stood at $1.1317.
While markets are eager to assume a last-minute deal will be hammered out given the dire consequences otherwise, the situation appears extremely fluid with each new headline appearing to contradict the former.
Greek Defence Minister Panos Kammenos, for instance, flagged the possibility that the country might get help from outside the EU if a deal was not forthcoming.
"It could be the United States at best, it could be Russia, it could be China or other countries," he said.
In commodity markets, U.S. crude futures bounced 40 cents to $50.42 a barrel on news of a smaller-than-expected rise in crude inventories.
Brent crude could only gain 6 cents to $56.49, having shed $1.91 on Tuesday.
(Editing by Shri Navaratnam & Kim Coghill)
