Greece's 'No' vote leads to stormy day of trading

Crowds chant in Athens as the referendum results come in. Photo / Getty Images

Greece's "no" vote on austerity measures lead to a tumultuous day of trading across equity markets - including New Zealand and Australia.

The S&P/NZX 50 closed down 1.1 per cent at 5,776.620, while Australia's S&P/ASX 200 was down 1 per cent at 6pm (NZ time).

Other Asian markets took even steeper falls.

Hong Kong's Hang Seng was down 3.7 per cent in late trading, while the Japan's Nikkei was down 2.4 per cent.

Harbour Asset Management analyst Shane Solly said that while the global situation was uncertain, the New Zealand market remained attractive, with strong corporate balance sheets and sustainable dividend yields.

"The market's holding up alright, but we've got a little way to go," he said.

Solly said it wasn't only the Greek situation that was unsettling markets.

An ongoing plunge in China's stock markets was also contributing to the uncertainty, he said.

Chinese stocks initially rallied sharply today after measures aimed at stemming a spectacular slump in shares prices - including a halt to new listings and massive buy back of shares by brokerages - were introduced over the weekend.

The Shanghai Composite Index had gained 7.8 per cent shortly after the open, while the Shenzhen market rose 6.6 per cent in early trading.

However, by 6pm (NZ time) the Shanghai index had dipped slightly into negative territory, while its counterpart in Shenzhen was had fallen 5.4 per cent.

The Shanghai Composite gained more than 150 per cent in the year to June 12 in a rally driven largely by domestic retail investors trading on margin, but has since slumped almost 30 per cent.

Meanwhile, air of stability returned to the New Zealand dollar today as investors took to the sidelines as two main world events, the Greek sovereign debt crisis and tanking Chinese share markets, played themselves out.

By the close of local trade the New Zealand dollar was at US66.70c - close to where it finished last week - having earlier dipped as low as US66.46c.

Early signs of improvement on Chinese markets - a 7.8 per cent gain on the Shanghai Composite Index - buoyed the currency - taking it to a high for the day of US67.0c.

Enthusiasm for the Kiwi eased again once the Shanghai Composite retreated and other Chinese share market indices started to fall way sharply.

Ongoing uncertainty surrounding Greece was another for investors to take to the sidelines, but both the Greek and Chinese share market issues had potential to push the Kiwi currency around, Sam Tuck, ANZ Bank senior foreign exchange strategist, said.

"Broadly speaking, the markets are reluctant to take the currency too far in either direction when we really don't know what's going on," he said.

"The stable price action in the Kiwi today does not reflect the potential building up to for moves once events become clearer," he said.

Evidence of a clear path forward for Greece and more stable markets in China would see the Kiwi gain, he said. The reverse would apply if conditions in both markets deteriorated further.

The Shanghai Composite Index has fallen nearly 30 per cent from its recent peak in June and the government has announced several measures to anchor investor confidence.

China as moved to temporarily suspend initial public offers - the ninth time in history.