Australia's share market has been hammered for a second straight day as it emerges as one of the biggest losers from the intensifying US-China trade war.
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The benchmark S&P/ASX200 index was down 162.2 points, or 2.44 per cent, to 6,478 points at 1615 AEST on Tuesday, while the broader All Ordinaries was down 164.2 points, or 2.45 per cent, to 6,546.4 points.
"There's blood on the streets of the financial markets this morning and with both the US and China seeming to be taking a harder line as each session passes, there could be even more downside to come for investors," Xchainge founder Nick Twidale said in an analyst note.
"Only time will tell if this is another dip in the relentless grind higher that we've seen so far in 2019" or the start of a bigger sell-off, Mr Twidale said, adding that to many this "feels a lot different" than earlier market volatility.
The falls came after the three major indices on Wall Street had their steepest percen tage drops of the year, down between 2.9 per cent and 3.5 per cent, while Japan's Nikkei 225 was down 1.8 per cent and the Shanghia Composite down 2.0 per cent.
The turmoil, sparked by escalating US-Chinese trade tensions, appeared to flare up after the US Treasury Department said that it had determined for the first time since 1994 that China was manipulating its currency.
The ASX200 fell as much as three per cent in early trade and at noon was still at levels last seen on June 11.
Tech and health care shares were the worst hit, slumping 4.78 per cent and 3.78 per cent respectively, but every sector except mining was down more than one per cent.
The big four banks were all significantly lower, with ANZ down 2.5 per cent to $26.62, Commonwealth down 1.8 per cent to $79.74, NAB down 2.5 per cent to $27.445 and Westpac down 2.6 per cent to $27.725.
Gold was the only sub-sector doing well as the price of the precious metal ticked higher, rising 1.3 per cent to $US1,465.
Global stocks have extended their already substantial losses and the offshore yuan hit an all-time low after Washington designated Beijing a currency manipulator in a rapid escalation of the US-China trade war.
US Treasury Secretary Steven Mnuchin said on Monday the government had determined that China is manipulating its currency, and that Washington would engage the International Monetary Fund to eliminate unfair competition from Beijing.
The Trump administration's dramatic move against China hastened the risk aversion seen in global markets this week. On Monday, China let the yuan slide in response to the latest US tariffs, which are expected to further aggravate trade tensions between the world's two largest economies.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.75 per cent to its lowest since January.
Japan's Nikkei shed 2.7 per cent, Australian stocks fell 2.6 per cent and South Korea's KOSPI slid 1.5 per cent.
The falls came after the three major indices on Wall Street had their steepest percentage drops of the year, with the Dow Jones Industrial Average finishing down 2.9 per cent, the S&P 500 down 2.98 per cent and the tech-heavy Nasdaq Composite down 3.47 per cent.
The local currency was boosted by a surprise drop in New Zealand's unemployment on Tuesday morning as the jobless rate dipped to 3.9 per cent against expectations of an increase to 4.3 per cent.
The Aussie dollar was buying 67.77 US cents, from 67.71 US cents on Monday, ahead of the Reserve Bank of Australia's interest rate decision at 1430 AEST.
Meanwhile, consumer confidence fell at the weekend as a gloomy mood about the economy appeared to take hold, according to an ANZ survey.
The ANZ-Roy Morgan Australian Consumer Confidence index dropped 2.3 per cent from the previous week, with respondents' perception of the economy, including the outlook for the next 12 months, tumbling 6.1 per cent, although sentiment about conditions during the next five years improved 3.8 per cent.
The pessimistic turn regarding the outlook for the next year cancels out the prior week's 5.8 per cent increase.
The weekly measure of consumer mood, which is based on about 1,000 face-to-face interviews conducted on Saturdays and Sundays, recorded a 4.3 per cent fall in how people felt about their financial condition compared with a year ago and a 1.9 per cent dip regarding their finances over the next year.
"Renewed trade war tensions and the related equity weakness seemed to have negatively impacted consumer sentiment, with the drop over the past week driven by big falls in perceptions of current financial and economic conditions," ANZ economist David Plank said.
The "time to buy a major household item" metric fell 2.6 per cent after having bounced 3.5 per cent in the previous week.
