Shanghai gains by the break in Asia while other markets down on Greece

Investing.com - Shares in Shanghai posted a rally on Monday after moves by regulators and the government at the weekend to shore up the market, allowinng it to defy negative sentiment seen in Tokyo and Sydney after a 'No' by Greek voters on a referendum whether to accept terms by international creditors for a sovereign bailout.

The Shanghai Composite ended the morning up 2.16%, while the Hang Seng index plunged 3.07% and the S&P/ASX 200 eased 1.27%.

The Mikkei 225 was down 1.75% after the break.

Asian policymakers in China and Japan and elsewhere had braced for any fallout from the Greek 'No' vote at the weekend as Greece's Prime Minister, Alexis Tsipras said Sunday he wanted a quick deal with its creditors and to restore banking sector operations to avert a humanitarian crisis.

Tsipras said that the International Monetary Fund report, released Thursday, which said that the Greek debt was not sustainable, was proof that his government was right on the demand its restructuring.

Greece's Finance Minister, Yiannis Varoufakis, said Sunday that the 'No' vote in the referendum was the peoples' response to five years of austerity and added that creditors never had a real intention to cooperate.

"We had two requirements: to put an end to austerity and to restructure the debt," he said. "Unfortunately, the creditors refused any meaningful discussion and from the first moment planned to shut down our banks in order to impose their positions," he said to reporters.

"The Greek people today return this ultimatum back to the creditors. From tomorrow, with this No, we will extend a cooperation hand to our partners and call them one by one in order to reach common ground."

At the weekend, China announced the suspension of initial public offerings and corralled its leading brokerages to establish a RMB120 billion fund to support the country's battered stock market amid a flurry of weekend activity aimed at arresting the market's slide at the Monday open.

While the move is not a direct response to Greece, the move follows a near-30% plunge in the value of shares traded in Shanghai since its recent peak, including a 12% drop last week. Beijing has stepped up its interventions in the market after last weekend's rate and reserve cuts from the People's Bank of China failed to lift market sentiment and put a floor under prices.

Eurogroup President Jeroen Dijsselbloem said talks on the next steps forward on Greece would be held Tuesday, issuing a terse statement Sunday evening in which he called the outcome "regrettable."

U.S. markets were shut on Friday, but the S&P Futures index shows a 1.14% drop seen and the Nasdaq futures index is down 1.07%.

In the week ahead, investors will be await the minutes of the Fed’s June meeting.

On Monday, Germany is to release data on factory orders. Switzerland is to publish a report on consumer inflation. Canada is to publish a report on the Ivey business index. In the U.S., the Institute of Supply Management is to release data on service sector activity.