Australian stocks sink below 5000 points to end worst week since 2011

The Australian sharemarket has closed lower, its benchmark index slumping below 5000 points in volatile trade as the fallout continues from China’s stocks turmoil.

In China, shares swung wildly as Beijing tried to settle its beleaguered markets amid growing fears about the global economy and a slump in oil prices.

Australia’s benchmark S & P/ASX200 index closed 0.39 per cent lower at 4,990.8, while the broader All Ordinaries index was down 0.38 per cent, at 5,049.4.

Today’s losses meant the S & P/ASX200 index was down 5.8 per cent for the week — its worst week since September 2011.

The Australian market had opened the day more than one per cent lower before briefly rallying and then sinking again.

The volatile trade came after China last night suspended a “circuit breaker” mechanism blamed for fuelling sharp sell-offs that shut mainland markets early twice in the space of four days, provoking losses on trading floors across the globe.

The initial response to the removal of the market circuit breaker was positive, but today’s wild swings were reminiscent of last year’s China-linked worldwide turmoil.

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