[SYDNEY] Australian shares turned sharply lower on Wednesday after an early attempt to stabilise fizzled out with investors on edge a day after the market suffered its biggest fall in over four months.
Australia's S&P/ASX 200 index fell as much as 2.6 per cent at the mid-session to 4,706.7 - a low unseen since July 2013. It was down 1.46 per cent, or 70.48 points, at 4,761.60 by 0256 GMT, extending Tuesday's 2.88 per cent drop.
Sentiment across the Tasman Sea also soured in late trade with New Zealand's benchmark S&P/NZX 50 index erasing early gains to be down 0.94 per cent, or 57.05 points, at 6,014.27. On Tuesday, the benchmark fell 1.3 per cent.
A late recovery in US stocks had held out the hope of some stability in Asia, but an absence of investor confidence saw regional markets delve deeper into the red.
Persistent fears about slowing global growth and the Chinese economy, the health of Europe's banking sector and concerns that Beijing and major central banks might not be able to turn things around have combined to rattle investors.
"What's the scary part about this is we can see things get pretty ugly, pretty quickly," said Evan Lucas, market strategist at IG in Melbourne, adding Australia's S&P/ASX 200 index could in time fall as far as 4,620-4,650.
Weighing heavily on the index were the major miners. BHP Billiton fell 2.5 per cent, while Rio Tinto shed 1.0 per cent. Newcrest Mining lost 3.9 per cent.
Australia's big lenders were also sharply lower except for Commonwealth Bank of Australia, which rose 2.2 per cent after posting a result that some analysts said was surprisingly good.
Australia and New Zealand Banking Group shed 2.2 per cent, while Westpac Banking Group and National Australia Bank were down over 1.0 per cent.
For more individual stocks activity click on In New Zealand, The Warehouse Group rose 0.8 per cent after data showed electronic retail spending had increased in January.
Leading the losers, dairy products provider a2 Milk Company fell 4.4 per cent and communications service provider Spark New Zealand lost 4.3 per cent.