Equity markets around the world fell yesterday and US oil prices slumped five per cent after Greece overwhelmingly voted against conditions for a rescue package and on unprecedented measures in China to staunch massive recent losses in its stock markets.

Wall Street trimmed earlier losses after the International Monetary Fund said it was ready to help Greece if asked to do so. US and European stock declines were less than some had feared.

Beijing introduced unexpected measures over the weekend to staunch a recent 30-per cent rout in its stock market since mid-June which had raised investors’ concerns about the stability of the world’s second-biggest economy.

Investors took heart after Greece's outspoken finance minister, Yanis Varoufakis, stepped down and Prime Minister Alexis Tsipras said his government was ready to return to negotiations with creditors in a bid to open shuttered banks.

“I think what we are seeing now is that initial concerns were overblown,” said Adam Sarhan, chief executive of Sarhan Capital in New York.

“Cooler heads are prevailing and now Tsipras can go to the creditors and have meaningful conversations. It also helps that the Greek finance minister is out because these negotiations can be very personality driven.”

European Council President Donald Tusk said eurozone leaders would meet in Brussels this evening (1600 GMT). Stunned European leaders had called for the summit to discuss their next move after the surprisingly strong victory by the No camp during Greek’s referendum on Sunday defied opinion polls that had predicted a tight contest.

Greek banks, which were shuttered last week after debt negotiations failed, will remain shut today and tomorrow with a daily limit on cash withdrawals.

US oil prices tumbled five per cent, their most in three months, after Greece’s rejection of debt bailout terms and China’s emergency measures to support its stock markets shook global markets.

Also taking a toll on the energy market were talks between Iran and world powers to meet a July 7 (today) deadline on a nuclear deal. That deal could release more oil into already oversupplied markets if sanctions on Iran are eased.

The Dow Jones industrial average was down 41.65 points, or 0.23 per cent, at 17,688.46. The S&P 500 lost 3.73 points, or 0.18 per cent, to 2,073.05. Earlier it fell as low as 2,058. The Nasdaq Composite dropped 2.87 points, or 0.06 per cent, to 5,006.35.

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