China stocks plunge as boosting measures fail; Greece weighs on other Asian benchmarks

Energy Associated Press

China's main stock benchmark plunged as much as 7 percent Friday as government stabilizing measures failed to reassure panicky investors while other Asian indexes fell ahead of Greece's weekend austerity referendum.

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KEEPING SCORE: The Shanghai Composite Index in mainland China tumbled as much as 7 percent in morning trading but losses moderated by the afternoon, when it was down 3.2 percent to 3,787.91, putting it on track to end the week 16 percent lower. Hong Kong's Hang Seng lost 0.1 percent to 26,249.27 while Japan's Nikkei 225 edged up 0.1 percent to 20,546.92. South Korea's Kospi slipped 0.1 percent to 2,105.95 and Australia's S&P/ASX 200 retreated 1.2 percent to 5,534.50.

CHINA SELLOFF: The market rout deepened as investors dumped shares in spite of government measures this week aimed at restoring confidence, such as cutting fees and easing rules on borrowing money for trading. The China Securities Regulatory Commission, the market watchdog, said late Thursday that it's launching an investigation into suspected stock market manipulation, state media reported, in an indication of Beijing's increasingly frantic efforts to halt the market slide.

ANALYST VIEWPOINT: "Policies take time to work their way through the system before sentiments can be more permanently altered," Bernard Aw of IG Markets in Singapore wrote in a commentary. "For now, the mood is verging on panic. It is extremely hard to calm a bear who is in a rage - not impossible, but tough."

GREECE: Investors are awaiting the outcome of a weekend vote in Greece on whether or not to accept tough conditions in exchange for a bailout deal for the Mediterranean country's troubled economy. Markets in Asia will get the first chance to react to the result of the vote on Sunday.

WALL STREET: U.S. markets ended the week quietly as investors sought safety ahead of the Independence Day holiday weekend. The Dow Jones industrial average fell 0.2 percent to close at 17,730.11 and the S&P 500 slipped less than 0.1 percent to 2,076.78. The Nasdaq composite fell less than 0.1 percent to 5,009.21.

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ENERGY: Benchmark U.S. crude fell 30 cents to $56.63 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 3 cents to close at $56.93 a barrel on Thursday. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 22 cents to $61.85 a barrel in London.

CURRENCIES: The dollar rose to 123.11 yen from 123.09 in late trading Thursday. The euro rose to $1.1094 from $1.1087.