European Union President Herman Van Rompuy said on Wednesday that negotiations on debt-riddled Greece are on track and restructuring it is not being considered.

"Negotiations are going on, they are well on track, and there is no question about restructuring of the debt," Van Rompuy told a news conference in Tokyo, where he is on a four-day visit with other EU officials to meet with Japanese leaders for an annual summit due to start later in the day.

Rompuy also said he will convene a summit of euro-zone heads of state by around May 10, at which leaders will move to implement a joint bailout package for Greece.

"On the basis of reports to be finalized in the coming days, the heads of state and of government will decide to activate the financing of the joint program under negotiation" for Greece, he said.

Global stocks, bonds, crude oil and commodities tumbled as investors feared a wave of sovereign debt crisis after ratings agency Standard & Poor's slashed Greece's rating to junk and lowered Portugal's rating by two notches.

Investors fear the downgrade of these two nations may be the beginning of a series of such moves as most governments are burdened with debt after they spent their way out of recession following the credit crisis. Even the U.S. is under threat of losing its top rating, economists noted.

Japan's Nikkei 225 Stock Average fell 2.8 per cent to 10,883.26 by early afternoon on the news -- the biggest drop of the Asian region and its lowest point since November 27. Japan's broader Topix index was down 2.4 per cent.