Asia shares fall led by Shanghai as investors eye safety ahead of Greece

Shares in Shanghai slumped on Friday, leading other Asian markets lower as investors headed for safety ahead of a weekend referendum that could decide whether Greece stays in the euro zone that is now too close to call.

The Shanghai Composite fell 5.57% before the break, while the Hang Seng index eased 0.55% and the S&P/ASX 200 was down 1.78%. The Nikkei 225 was down 0.44%.

Prime Minister Alexis Tsipras on Wednesday urged Greeks to reject an international bailout deal in a referendum due to be held on July 5, souring hopes of any breakthrough.

Less than 24 hours before, Tsipras had written a conciliatory letter to creditors asking for a new bailout that would accept many of their terms.

On Wednesday Greece became the first developed country to default on the International Monetary Fund after its second bailout program expired late Tuesday. The IMF confirmed that the Greek government failed to make a scheduled €1.6 billion loan repayment.

In Australia, May retail sales data showed a 0.3% increase month-on-month, below a forecast for retail sales up 0.5% month-on-month.

Earlier in Australia, the June AIGroup services index rose 1.6 points to 51.2.

“The improvement in services-industry conditions so far this year has been concentrated in consumer services,” AI Group Chief Executive Innes Willox said.

“Increased housing-market activity and very low interest rates are now assisting retail and personal and recreational services – although consumer-confidence and household-income growth are still below par. For the more business-oriented services subsectors weak business confidence, an uncertain outlook and low private and public investment are still weighing on demand across a range of design, consulting, personnel and administrative services.”

U.S. markets are shut on Friday.

Overnight, U.S. stocks were lower after the close on Thursday, as losses in the Financials, Healthcare and Basic Materials sectors led shares lower.

At the close in New York, the Dow Jones Industrial Average lost 0.16%, while the S&P 500 index declined 0.03%, and the NASDAQ Composite index declined 0.08%.

The best performers of the session on the Dow Jones Industrial Average were Intel Corporation (NASDAQ:NASDAQ:INTC), which rose 1.24% or 0.38 points to trade at 30.55 at the close. Meanwhile, Exxon Mobil Corporation (NYSE:NYSE:XOM) added 0.93% or 0.77 points to end at 83.14 and Visa Inc (NYSE:NYSE:V) was up 0.57% or 0.39 points to 68.24 in late trade.