However, yields on government bonds from Italy, Spain and Portugal, the countries considered most vulnerable to contagion from Greece, also fell. Prime Minister Alexis Tsipras was huddled with advisers, pulling together reforms that are expected to include much tougher measures than those included in the previous plan from creditors, rejected by Greeks in a referendum on Sunday.
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Last week, Greece became the first developed economy to default on a loan with the global Monetary Fund. Both regions share markets are suffering, although for two very different reasons. All ASX sectorial indices closed higher, with shares of financial, industrial, consumer discretionary and consumer staple companies being top gainers. The dollar fell as deep as 121.700 yen, from 122.775. Against the dollar, it went above $1.11.
2016 GDP forecast unchanged at 2.3%. The greenback also rose against the Swiss franc, up 0.3 per cent at 0.9484 franc. USA crude nudged up 0.4 percent to $51.86 early on Thursday but has shed almost nine percent so far this week.
Maybank fell 0.97% to 9.19 ringgit; Telekom Malaysia lost 2.04% to 6.71, while Petronas Gas went down 0.37% to 21.42 ringgit.
There was a bigger jump in China markets, buoyed by a barrage of government support measures. It remains up 13.1% for 2015 so far.
Today in China, Iron ore future is down nearly 8% and Steel prices down by 5%. A technical glitch forced the halt, not a cyberattack, the exchange said.
A hike in interest rates increases the cost of borrowing, crimping corporate profit margins.
“If the troika uses this vote to boot Greece from the euro, the risk off trade will likely continue to widen spreads”, said Steve Blitz, chief economist at stockbroker ITG.
While there is still a buffer to allow the Greek Central Bank distribute €88bn a day a larger haircut would at the least reduce the amount of funds available, causing the banks to take a share of deposits, possibly even those worth less than the usual €10,000 ceiling according to some analysts.
And European Commission President Jean-Claude Juncker warned “we have a Grexit scenario prepared in detail” if Greece failed to reach a deal, although he insisted he wanted Athens to stay. The main emerging markets index scored its best gain since January. The S&P 500 gained 12.58 points, or 0.61 percent, to 2,081.34 after briefly falling below its 200-day moving average. The index was down a combined 1307 points over the past three trading days. Turnover reduced to HK$172.5 billion from HK$212.7 billion on Monday. The common currency peaked at $1.11250 overnight. “Japanese markets feel the fallout as investors become averse to regional markets more generally”. Shares of Coal India scaled record high.
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Manila fell 1.06%, or 80.15 points to 7,455.15. Singapore’s Straits Times index rebounded 0.2% at 3340.93. The Nasdaq Composite added 5.52 points, or 0.11 percent, to 4,997.46.
