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The Australian share market fell sharply again as traders worry US-China trade tensions could worsen further.

The benchmark S&P/ASX200 index finished Monday down 83 points, or 1.27 per cent, to 6,440.1 points, while the broader All Ordinaries was down 83.3 points, or 1.26 per cent, to 6,531 points.

The plunge came after Washington and Beijing unveiled tit-for-tat tariffs on Friday and US President Donald Trump tweeted he was ordering American companies to look into alternatives to China.

Markets are very skittish about an apparently rapid unravelling of the global, interconnected modern economic order and yet another tweet by Trump about how well trade talks are going won't be able to reassure them, Mr Weston added.

The global sell-off eclipsed the start of the last week of Australian earnings season.

Every other sector other than utilities, which fell 0.9 per cent, was at least 1.0 per cent in the red.

Energy shares were the hardest hit, collectively down 3.1 per cent as the price of Brent crude dipped to $US59.

Woodside Petroleum dropped 3.7 per cent, Oil Search was down 2.7 per cent and Santos fell 2.5 per cent.

Viva Energy fell 7.9 per cent to a two-month low of $2.10 after the Shell petrol station licensee reported its half-year profit had dropped 43 per cent.

Gold miners were the only bright spot as the price of the precious metal reached $US1542 an ounce, its highest price since April 2013.

Newcrest gained 4.6 per cent to $36.05, Northern Star climbed 8.7 per cent to $12.39, Evolution was up 9 per cent to $5.33 and Westgold shot up 20.2 per cent to a two-year high of $2.35.

Elsewhere in the materials sector, Boral fell 20.6 per cent to a six-year low of $3.94 after the building materials maker's underlying net profit slumped 7.0 per cent.

Mining giant BHP gained 2.1 per cent to $36.49, Rio Tinto was down 2.6 per cent to $82.78 and Fortescue Metals dropped 5.3 per cent to $7.17 despite the iron ore producer almost tripling its full-year profit.

The big four banks were all lower, with ANZ down 1.4 per cent to $26.27, Commonwealth down 0.8 per cent to $76.76, NAB down 1.0 per cent to $27.06 and Westpac down 0.7 per cent to $27.62.

Macquarie fell 2.2 per cent and IOOF fell 6.9 per cent after it set aside another $235 million for customer remediation.

Amaysim plunged 23 per cent to an all-time low of 51.5 cents after the mobile and energy plan provider said its full-year underlying earnings had dropped by a third.

G8 Education fell 16 per cent to a 10-month low of $2.30 after reporting a mixed performance at its recently acquired childcare centres.

Adairs gained 11.8 per cent to a two-month high of $1.755 after the homeware company reported its full-year sales grew 9.7 per cent.

International Markets

Following the G7 summit of world leaders in Biarritz, France, Trump said on Monday he believed China was sincere about the desire to reach a deal, citing what he described as increasing economic pressure on Beijing and job losses there.

Shares of tariff-sensitive companies rose in response. Apple's 1.90 per cent gain provided the biggest boost to each of the major indexes.

Chipmakers, which are heavily reliant upon China for revenue, also rose. The Philadelphia Semiconductor index added 0.86 per cent after slumping more than 4 per cent on Friday.

Still, market participants said the rebound paled in comparison to last week's decline, and they expected recent volatility to continue.

The Dow Jones Industrial Average rose 269.93 points, or 1.05 per cent, to 25,898.83; the S&P 500 gained 31.27 points, or 1.10 per cent, to 2,878.38; and the Nasdaq Composite added 101.97 points, or 1.32 per cent, to 7,853.74.

Commerce Department data showed new orders for key US-made capital goods rose modestly in July while shipments fell by the most in nearly three years. The data could provide the Federal Reserve with more fuel to cut interest rates again when policymakers meet next month.

Concerns about the global economy slipping into recession and uncertainty over the pace of US interest rate cuts have created some anxiety about how long the current US expansion will last.

The S&P 500 is off more than 5 per cent from the record high hit in late July after suffering its longest run of weekly declines since May.

Even with Monday's broad gains, with each of the major S&P 500 sectors rising, Wall Street's fear gauge, the CBOE Volatility index, hit its highest level in more than a week earlier in the session.

Among other stocks, Celgene rose 3.20 per cent after Amgen said it would buy the company's psoriasis drug Otezla, clearing the way for Bristol-Myers Squibb to go ahead with its $US74 billion ($109 billion) deal for Celgene. Shares of Bristol-Myers rose 3.28 per cent

The S&P 500 posted four new 52-week highs and 17 new lows; the Nasdaq Composite recorded 17 new highs and 134 new lows.

About 5.71 billion shares changed hands in US exchanges compared with the 7.57 billion daily average over the last 20 sessions.

Source: Morningstar

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