Chinese stocks have fallen again, a day after their worst plunge since 2007 caused market losses around the world.
The global sell-off was driven by fears that China's slowing growth might pull down other economies.
The
Shanghai Composite, China's main stock exchange, was down 4% at midday
on Tuesday - it had dropped 8.5% on what state media have called China's
"Black Monday".
Tokyo's Nikkei index had a volatile day, closing 4% lower.
Other Asian markets opened lower on Tuesday, but recovered in later trade.
The Shanghai index opened 6.4% lower, but recovered slightly to end the morning session of trade down 4.3% at 3,071.06 points. Live coverage of global markets
After
decades of rapid growth, China is slowing down, and investors globally
are worried that firms and countries which rely on high demand from
China - the world's second largest economy and the second largest
importer of both goods and commercial services - will be affected.
Carrie Gracie, China editor, BBC News: 'Beijing thinking hard'
Some investors had hoped that the Chinese government might make a dramatic intervention to help.
But
after two months of attempting and failing to shore up the markets at a
cost of hundreds of billions of dollars in state funds, even Beijing
now seems to be thinking hard about what stock prices are sustainable in
the long term.
For a government whose legitimacy rests on
economic competence, and which had hoped that a rising stock market
would help ease the problems of a wider economic slowdown, this
financial crisis still carries real political dangers.
Chinese
shares had experienced a year-long rally - mainly fuelled by investors
borrowing money to buy shares - which came to an end in June.
The Chinese government then intervened in financial markets, to try to maintain momentum in the economy.
Two
weeks ago the central bank devalued the currency, the yuan - this
raised fresh concerns that China's economy could be in worse shape than
previously thought.
A cheaper currency lowers the price of China's exports, making them more attractive to global firms.
Elsewhere
in Asia and Australia on Tuesday, markets beat expectations, opening
lower but then returning back to positive territory:
Korea's KOSPI gained almost 1%
Australia's S&P ASX/200 ended the day 2.7% higher
The dollar remained weak at 119.15 yen, up from a seven month low of 118.51 yen in New York on Monday.
Commodity prices also recovered after Monday's falls, although oil remains under pressure because of a global oversupply.
Overnight, the Europe and the US saw dramatic falls, but are expected to show some signs of recovery when they open on Tuesday.
Wall Street's Dow Jones fell 6%, then almost recovered its losses before closing 3.6% lower.
London's FTSE 100 index closed down 4.6%.
Major markets in France and Germany down by 5.5% and 4.96% respectively.
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