Australian stocks were smashed in fallout from a heavy sell-off in China.
Stocks fell at the open but then recovered before the Chinese markets opened down sharply lower, defying all attempts by Beijing to stem the losses on the market.
The ASX200 closed down 2.01%, erasing the gains of Tuesday’s surprise rally.
The Greek debt crisis still hung over the market. “All the latest commentary from European leaders has had a fairly pessimistic tone to it regarding a potential deal,” said Stan Shamu, market strategist at IG.
But lower commodities prices on the resource-heavy ASX also factored into trade. Futures prices for iron ore, nickel, copper and lead were all smoked overnight on the London Metals Exchange.
Overnight, the S&P 500 closed 0.6% higher but European shares fell as investors watched for developments on a new Greek debt deal.
On the local market, all ten sectors were in red with both financial and resources stocks being sold down hard.
The ANZ bank lost 2.18% to $32.31 and the NAB 2.13% to $33.48.
BHP was weaker by 2.78% to $25.52 and Rio Tinto 2.58% to $50.40.
Fortescue Metals (FMG) was weaker by more than 5% to $1.69, as the price of iron ore fell 4.6% to below $US50 a tonne. BC Iron was down 6.67% to $0.28 and Mount Gibson 5% to $0.19.
After an almost 8% rise on Tuesday, Qantas was trading down 2.19% to $3.35.
Gold stocks, which have enjoyed strong rises for the last two sessions, tumbled. Northern Star was down
2.23% to $2.19, Evolution 2.43% to $1.20 and Newcrest 3.29% to $12.66.