Asian shares tumble in early trade Wednesday; Greece, China woes in focus(Update)

MSCI's broadest index of Asia-Pacific shares outside Japan extended its early losses after Chinese shares opened sharply lower, and was last down 2.5 percent. Japan's Nikkei stock index fell 1.5 percent, roiled by both China's dent to regional sentiment and the stronger Japanese currency. Shanghai's benchmark composite index was down 6.4 percent, while the CSI300 index of the largest listed companies in Shanghai and Shenzhen slipped 6.7 percent. (EPA picture shows a man usings his smartphone in front of a monitor displaying the closing information of Tokyo's Nikkei Stock Average (L) and the current exchange rate of the Japanese yen against the US dollar (R) in Tokyo, Japan, 07 July 2015.)

Earlier report:

TOKYO: Asian shares fell on Wednesday as investors fretted over Greece's debt crisis and a recent plunge in Chinese stocks, while the euro steadied.

Euro zone members gave Athens until the end of this week to propose reform measures in order to secure the funding it needs to stay in the euro zone.

Investors nervously awaited the opening of China's share markets, after they slumped on Tuesday despite a flurry of new market support measures from Beijing.

The drop extended a savage correction that has clipped 30 percent off Chinese shares since mid-June, threatening a new blow to the already slowing economy.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> was down 0.2 percent, while Japan's Nikkei stock index <.N225> fell 0.7 percent.

Benchmark copper on the London Metal Exchange skidded 4.5 percent to $5,339.30, moving back toward a six-year low touched in the previous session on fears of slowing global demand for the metal.

U.S. stock futures were down 0.2 percent, suggesting that the gloomy mood might continue throughout the global session even after major indexes closed higher on Wall Street.

Investors fear Greece's financial woes, if it fails to reach a deal with its lenders, could spread to other southern European nations. These concerns grew when the European Central Bank increased the haircuts on the collateral it demands from Greek banks even as it maintained its emergency liquidity funding for them.

"The main concern remains the extent to which large market moves are consistent with risk-off sentiment – there has been some EUR weakness and increase in periphery spreads, but European EGB yields have compressed as Bund yields compressed proportionally more," strategists at Barclays said.

"Nonetheless, we do not rule out that contagion increases as the situation worsens in Greece," they added.

The euro was down about 0.1 percent on the day at $1.1006, after falling as low as $1.0916 on Tuesday, its lowest since June 2.

The euro edged down about 0.1 percent to 134.77 yen , after falling to a six-week low of 133.52 on Tuesday.

The dollar slipped about 0.1 percent to 122.46 as the Greek uncertainly heightened the Japanese currency's safe-haven appeal, though it remained above its six-week low of 121.700 yen hit on Monday.

The yield on the 10-year note last stood at 2.258 percent, above its U.S. close of 2.231 percent on Tuesday, when it dropped to a five-week low of 2.185 percent.

U.S. crude added 0.7 percent to $52.68, bolstered by expectations that U.S. government data due later in the session would show an inventory decline. On Tuesday, it settled at a three-month low as the Greek crisis raised fears about lower demand for oil.- Reuters