A tumble in global stocks spread to Asia on Wednesday as fears heightened that Greece's debt woes could spread to other countries, which pushed the euro down to one-year lows against the dollar.

Shares in Europe are expected to open little changed, stabilizing after the FTSEurofirst 300 index of leading European shares dropped 3 percent to a two-month closing low on Tuesday.

The MSCI index of Asia ex-Japan stocks fell nearly 2 percent, with Shanghai and Hong Kong hitting seven-month and nine-week lows, respectively, as skepticism over the 110 billion euro ($142 billion) bailout plan intensified.

The euro, which suffered its steepest one-day loss since last June in the previous session, notched another one-year low at $1.2936 before recovering slightly. Traders expected the single currency to remain under pressure.

One gets the feeling that the euro zone is turning out to be a basket case and of course rumors about Spain and Portugal's sovereign debt aren't helping. I suspect the market wants to take the euro to as low as $1.25 in the short term, said Joanthan Cavenagh, currency strategist at Westpac in Sydney.

Markets in Japan, Korea and Thailand were closed for holidays.

Risk aversion lifted the dollar up, with its index gaining 0.26 percent on top of a 1.4 percent rise on Tuesday. That was the biggest daily gain so far this year and took the index to the highest since May 2009.

Oil extended losses falling toward $82, following the steepest one-day percentage loss in three months on Tuesday, on rising inventories and a firm dollar.

A combination of worries including contagion to Spain and Portugal, policy tightening in China, debt concerns in the UK and Japan, all threaten to undo the positive message from economic data, Mitul Kotecha, head of global FX strategy at Credit Agricole said in a note to clients.

The immediate attention remains on Greece and growing skepticism about Greece's ability to carry out austerity measures in the face of rising domestic opposition, Kotecha said.

In Athens, striking public workers challenged Greece's bailout-for-austerity deal, starting a 48-hour national strike that shut down ministries, tax offices, schools, hospitals and public services.


Hong Kong's Hang Seng was trading over 2 percent lower, sliding to a nine-week low, with banking stocks falling across the board while Shanghai's key index fell as much as 2 percent to its lowest in seven months.

The Shanghai composite is the region's worst-performing index, falling more than 13 percent year-to-date as Beijing's moves to tighten policy take a heavy toll on banking and real estate stocks.

Even if the problems in the U.S. and Europe look like they will not filter down to Asia, investors are trying to unload their risk as soon as possible, said Castor Pang, head of research at Cinda International.

The HSI looks attractive at this level, but I don't see any buy orders coming in, Pang said.

Australian stocks fell 1.3 percent to their lowest level since early March with the resources sector leading losses.

Gold gave up its safe-haven status to the dollar, continuing to lose ground after dropping sharply overnight in step with a broad sell-off in commodities and stocks.

Spot gold was quoted at $1,168.55/9.55 at 0605 GMT versus Tuesday's notional close of $1,170.65.

(Additional reporting by Anirban Nag in Sydney and Sui-Lee Wee in Hong Kong; Editing by Kazunori Takada)