Asian stock markets sink after Greece closes banks

Asian stock markets sank Monday after Greece closed its banks and imposed capital controls in a dramatic turn in its struggle with heavy debts, AP reported.

Oil prices declined and the euro edged down against the dollar after Athens announced the moves to stanch the flow of money out of Greek banks and put pressure on creditors to offer concessions before a bailout program expires Tuesday.

The Shanghai Composite Index fell 3.7 percent to 4,035.48 points despite China's surprise weekend interest rate cut. Tokyo's Nikkei 225 index shed 2.4 percent to 20,218.17 points.

Hong Kong's Hang Seng lost 2.7 percent to 25,949.30 and Sydney's S&P ASX-200 was off 2.3 percent at 5,418.80. Seoul's Kospi dropped 1.4 percent to 2,061.00 and India's Sensex declined 1.6 percent to 27,370.30. The euro slipped to $1.101 from the previous session's $1.116. The dollar declined to 123.15 yen from 123.89 yen.

Greece's Cabinet closed banks for six business days and restricted cash withdrawals. The Athens Stock Exchange was due to be closed Monday. That follows Prime Minister Alexis Tsipras' weekend decision to call a referendum on European and International Monetary Fund proposals for Greek reforms in return for bailout funds.

The accelerating crisis has raised questions about whether Greece might withdraw from the 19-nation euro currency, a move dubbed Grexit.

'Even if a deal is somehow reached, the ability of Greece to implement agreed reforms is doubtful,' said IHS Global Insight economist Rajiv Biswas in a report.