Greek vote plan sends stocks tumbling

Stocks on Wall Street plunged for a second day this week in a broad global selloff as Greece's plans for a referendum fuelled worries that the eurozone bailout plan might fall apart.

Greece announced after European markets had closed on Monday that it would hold a referendum on the government's bailout deal with eurozone leaders, It includes widespread cuts in public services, salaries, pensions and jobs.

A "no" vote could eventually propel Greece out of the euro while a "yes" vote could deflate public opposition to austerity measures.

The Dow Jones Industrial Average closed (9am NZ time) on its lows, down 297.05 points, or 2.5%, to 11,657.96, led lower by JP Morgan Chase's 5.9% fall and Bank of America's 6.3% drop.

The Dow's decline followed 276-points on Monday, the biggest-point drops since late September.

The S&P 500 index was down 2.3% to 1218.28. All 10 of its sectors fell, with financial stocks posting the biggest declines. Morgan Stanley slid 8%, Citigroup fell 7.7% and Goldman Sachs declined 5.5%.

The technology-heavy Nasdaq Composite was down 2.9%, to 2606.96.

European sharemarkets slumped with the Stoxx Europe 600 falling 3.5% to 235.06. The UK's FTSE 100 closed 2.2% lower at 5421.57, Germany's DAX fell 5% to 5834.51 and France's CAC-40 closed down 5.4% at 3068.33.

Elsewhere, Greece's ATHEX Composite ended down 6.9% and Italy's FTSE MIB slumped 6.8%. 

Asian stocks ended mostly lower after data showed China's manufacturing activity slowed.

Japan's Nikkei Stock Average lost 1.7% to 8835.52 and Australia's S&P/ASX 200 index declined 1.5% to 4232.9, while Hong Kong's Hang Seng Index fell 2.5% to 19,369.96 and India's Sensex fell 1.3% to 17,480.83.

Korea's Kospi closed flat at 1909.63, while the Shanghai Composite Index eked out a 0.1% gain to finish at 2470.02.

Commodities: Oil, gold down
Light, sweet crude oil for December delivery was down 3.8%, or $US3.56 a barrel, at $US89.63 in New York. The low of $US89.17 was the weakest in six days.

North Sea Brent crude for December was down 2.7%, or $US2.93 a barrel, at $US106.63.

Gold futures slumped as the US dollar rose. The contract for November delivery was down $US18, or 1%, at $US1706.20 an ounce.

Currencies: Euro falls on Greece move
The euro fell to its lowest level against the US dollar in almost a month, giving up all the gains from last week's debt deal.

The proposed referendum on Greece’s latest bailout resurrected fears that the European debt crisis could spiral out of control.

The euro fell to $US1.3687, down from $US1.3859 late on Monday and fell to ¥107.18 versus ¥108.56.

The US dollar traded at ¥78.33, from ¥78.17 late on Monday. The UK pound fetched $US1.5952 from $US1.6087, and the dollar bought 0.8892 Swiss franc from 0.8769 franc.