Asia's stock markets bounced back on Tuesday, recovering from the previous day's heavy selloff, even as Greece inched nearer toward a debt default.
According to Reuters, Greece will not be paying a 1.6 billion euro loan installment due to the International Monetary Fund (IMF) on Tuesday, citing a Greek government official. The cash-strapped country needed emergency funding to make the payment, but negotiations for a cash-for-reform package between Athens and its creditors broke down over the weekend after Greek Prime Minister Alexis Trspras called for a surprise referendum.
Overnight, Greece-related fears took a toll on Wall Street shares. The blue-chip Dow and the S&P 500 wiped out gains for the year, down 1.95 and 2.09 percent, respectively. The Nasdaq Composite lost 2.4 percent to end below the 5,000 mark for the first time since May 13.
Mainland indices rebound
In yet another highly volatile session, China's Shanghai Composite index closed up 5.55 percent, after plunging nearly 5 percent to hit an intra-day low of 3,847 earlier in the day.
The CSI300 index of the largest listed companies in Shanghai and Shenzhen piled on 6.7 percent, while the Shenzhen Composite also reversed course to reap 4.8 percent. In Hong Kong, the index surged 1.3 percent.
Analysts attribute the upswing to the launch of new measures by Beijing aimed at bolstering market confidence.
"Talk of putting a halt to the initial public offering (IPO) process helped spur some buying and it will certainly help mitigate the prospect of traders selling existing stock holdings to take part in the IPO process. There has also been talk of using the country's endowment fund to buy equities, as well as cutting stamp duty, while the central bank has further cut the seven-day repo rate by 20 basis points to 2.5 percent," Chris Weston, IG's chief market strategist, wrote in a note. "The market may be keen to deleverage, but for today the bulls are being enticed into longs courtesy of further (and potential) central bank and governmental initiatives."
Tuesday's wild ride comes on the back of a torrid session on Monday, where the Shanghai bourse closed down 3.3 percent into bear-market territory even as the People's Bank of China (PBOC) unveiled a bigger-than-expected easing package over the weekend.
"In China, sentiment is very unsettled right now which is very influential in a retail-driven market. That will likely go on for a couple of weeks so volatility will be a constant theme," Stephen Sheung, head of investment strategy of SHK Private, told CNBC.
Nikkei adds 0.6%
Japan's Nikkei 225 clawed back some of Monday's 2.9 percent slump.
Gainers were led by airlines, which got a boost from the tumble in jet fuel prices. Japan Airlines and ANA Holdings climbed 1.7 and 2.9 percent, respectively. A recovery in most export-oriented counters also supported the bourse; carmakers such as Toyota Motor, Nissan and Honda bounced up between 0.6 and 1.2 percent.
However, shares of Sony fell 8.3 percent after the company said it plans to raise up to $3.6 billion by issuing new shares and convertible bonds to invest in its fast-growing image sensors business.
Meanwhile, Japan Post will be filing applications with the Tokyo Stock Exchange for the listings of the parent company and its units Japan Post Bank and Japan Post Insurance on Tuesday.
Kospi gains 0.7%
South Korea's Kospi index edged up, a day after finishing at a one-week low.
Samsung Techwin inched up 0.2 percent after shareholders on Monday approved a proposed deal to be sold to Hanwha Group. Shares of the latter recouped losses to rise 2.2 percent late Tuesday.
ASX rises 0.7%
Australian shares ended up in choppy trade, which saw the benchmark S&P ASX 200 index hit a five-month low at the start of trade. Apart from Greece, investors trying to close their books for the June 30 end of the financial year fueled volatility in the market on Tuesday.
The bourse gained upward support after banking heavyweights turned positive in the final hour of trade. Commonwealth Bank of Australia rebounded 0.5 percent, while Westpac and National Australia Bank closed up 0.4 percent each.
Within the resources sector, market bellwether BHP Billiton clawed back losses to settle 0.4 percent higher.
Meanwhile, New Zealand-listed Briscoe Group announced it has acquired 19.9 percent of clothing retailer Kathmandu early Tuesday, sending the latter's Sydney-listed stock up 25.6 percent. In Auckland, shares of Briscoe Group rallied 1.8 percent, while Kathmandu surged 25.9 percent.