China on Thursday demanded Canada release a Huawei Technologies executive who was arrested in a case that adds to technology tensions with Washington and threatens to complicate trade talks.

Huawei's chief financial officer, Meng Wanzhou, faces possible extradition to the United States, according to Canadian authorities. The Globe and Mail newspaper, citing law enforcement sources, said she is accused of trying to evade US curbs on trade with Iran.

China's foreign ministry urged Canada and the US to "clarify" the reason Ms Meng was detained.

"We have made solemn representations to Canada and the US, demanding that both parties immediately clarify the reasons for the detention, and immediately release the detainee to protect the person's legal rights," foreign ministry spokesman Geng Shuang told a press briefing on Thursday morning.

The timing of the arrest is awkward following the announcement of a US-Chinese cease-fire in a tariff war over Beijing's technology policy. Meng was detained in Vancouver on Saturday, the day Presidents Donald Trump and Xi Jinping met in Argentina and announced their deal.

Asian stock markets tumbled on the news, fearing renewed US-Chinese tensions that threaten global economic growth. Market indexes in Tokyo and Hong Kong by 1.9 percent and 2.8 percent and Shanghai was off 1.7 percent at midday.