Asian shares fall on eurozone fears

HONG KONG: Asian markets were mostly lower on Thursday and the euro sat near 22-month lows against the dollar after European leaders failed to agree a coherent plan to save Greece from exiting the eurozone.

While a summit in Brussels saw a pledge of support for Athens it highlighted divisions between France and Germany on dealing with the crisis.

Tokyo fell 0.29 percent by the break, Hong Kong shed 0.47 percent, Shanghai gave up 0.22 percent, Sydney was flat and Seoul gained 0.16 percent.

Investors had been looking for the get-together to come up with a plan to keep debt-laden Greece in the euro with a general election next month expected to see a triumph for anti-austerity parties, who have promised to tear up a bailout deal.

Such a move would likely lead to Athens leaving the euro project, which analysts fear would have a knock-on effect for other troubled economies such as Spain and Italy.

EU president Herman Van Rompuy told journalists after the summit: "We want Greece to remain in the euro area while respecting its commitments."

And French President Francois Hollande said there was "no time to waste" in encouraging growth in the eurozone but German Chancellor Angela Merkel stood steadfast against his calls for jointly pooled eurozone debt, or eurobonds.

"I say that we have to act straightaway for growth ... otherwise there will still be doubt on the markets," said Hollande, in his first summit since ousting Nicolas Sarkozy earlier this month.

Merkel faced pressure to give ground on her hardline austerity doctrine, which has seen waves of protests across Europe and many of her allies - including Sarkozy - kicked out of office.

However, she rejected the call for eurobonds on the grounds they are "not a contribution to stimulating growth in the eurozone" and adding that such instruments ran contrary to EU treaties. (AFP)