Investing.com - Shares in Asia slumped on Wednesday as efforts by China to support shares failed to halt a rout in progress for more than a week and nervousness over a deadline for Greece to develop a reform package also dragged down sentiment.
The Shanghai Composite Index lost 3.8% by the break after having fallen as much as 8% shortly after the open with trading in more than 500 companies listed in Shenzhen and Shanghai suspended.
The People's Bank of China said it was watching market movements and would act to eliminate systemic and regional risks as a result of selling.
The China Insurance Regulatory Commission said ahead of the open it would increase the limit on how much insurance companies can spend buying blue-chip stocks to as much as 40% of total assets from 30%.
Hong Kong's Hang Seng Index extended losses falling 4.18% to 23932.45. The S&P/ASX 200 also slumped, down 1.84% to 5,478.500 and the Nikkei 225 fell 2.07%.
Greece has a five-day deadline to submit a detailed package of reforms to international creditors in return for a bailout or risk the "bankruptcy" of both the country and its financial system, European Council President Donald Tusk and Commission President Jean-Claude Juncker warned Tuesday.
In a high-stakes atmosphere that followed a meeting of euro zone leaders in Brussels after Greece's Sunday austerity referendum, Tusk and Juncker did not mince words.
"The stark reality is that we have only five days left to find an ultimate agreement," Tusk said. "Until now I've avoided talking about deadlines, but tonight I have to say it loud and clear: the final deadline ends this week."
"If there's no deal, it will mean all the possible consequences, including the worst-case scenario, where all of us will lose," Tusk continued. "Failure to find an agreement will lead to the bankruptcy of Greece and the insolvency of its banking system."
Overnight, U.S. stocks were higher after the close on Tuesday, as gains in the Utilities, Consumer Goods and Oil & Gas sectors led shares higher.
At the close in New York, the Dow Jones Industrial Average rose 0.53%, while the S&P 500 index added 0.61%, and the NASDAQ Composite index gained 0.11%.