Asian equities tumbled today as a collapse in Chinese shares began to contaminate other markets, and after European leaders slapped Greece with a deadline to submit fresh bailout reform proposals.
With markets buffeted by two global crises, traders ran for the cover of investments considered safe in times of upheaval such as the yen.
Shanghai plunged 5.90 per cent, or 219.93 points, to end at 3,507.19 after losing more than eight per cent at one point. The losses come despite Chinese leaders announcing fresh measures to staunch a correction that has wiped trillions off the country's markets.
In late trade Hong Kong was down 8.43 per cent, the market's biggest drop since October 2008, leaving the exchange at its lowest level since December.
Most other regional markets were also hit by the spillover effects, with many hosting companies with links to China.
Tokyo sank 3.14 per cent, or 638.95 points, to 19,737.64, Seoul slipped 1.18 per cent, or 24.08 points, to 2,016.21 and Sydney retreated 2.01 percent or 111.9 points to 5,469.5.
Taipei shed 2.96 per cent, or 274.05 points, to close at 8,976.11.
"China's stock market rout is now spreading to other financial markets, creating a sweeping sense of panic and liquidity crunch," said Zheng Ge, an analyst at Wanda Futures Co.
Shanghai is down more than 30 per cent from its closing peak on June 12, when it had risen by more than 150 per cent in 12 months in a borrowing-fuelled frenzy enhanced by hopes for economy-boosting government measures.
However, analysts said new restrictions on margin trading and concerns about the overvaluation of many stocks have forced mainland investors -- mostly individual retail traders -- to cash out.
There are now fears that the hammering to stock markets will hit the wider Chinese economy, the world's second biggest, which is already struggling with slowing growth.
The fall came despite the government announcing new measures to support the market, while Bloomberg News reported that the recent slump has led at least 1,249 companies to halt trading in the mainland, accounting for 43 percent of total listings.
Alex Wong, Hong Kong-based asset-management director at Ample Capital, added: "Gradually this will drag other markets lower because the magnitude of a China crisis would be far bigger than anything happening in Greece.
