The local market shot down at the opening bell, continuing momentum from yesterday’s 2 per cent plunge as global markets were shaken on concerns of an economic fallout from China’s sharemarket falls.

The benchmark index entered a technical correction this morning, down 10.2 per cent from its peak of 5996.9 in April to a trough of 5383.7 before recovering in the afternoon.

While China’s sharemarkets opened deep in the red again today, they soon swung positive and managed to climb higher, as Beijing’s ban on major shareholder selling seemed to calm market panic. The Australian sharemarket soon followed, and closed flat.

At the 4.15pm (AEST), the benchmark S & P/ASX200 index was up 1.5 points, or 0.03 per cent, to 5471, while the broader All Ordinaries index was flat at 5456.3.

Tokyo stocks plunged more than 3 per cent in early trade, after tumbling more than 3 per cent in the previous session, but also pared deeper losses to close largely flat as China’s markets settled.

Both China’s Shanghai Composite and Shenzhen indexes have lost more than a third of their value in the past month, sending jitters across global sharemarkets in the fear that the slump could impact on broader economic growth.

“Local investors strapped in as they braced themselves for another wild day on the market,” CMC Markets sales trade Betty Lam said. “[But] China’s mass exodus came to a halt today as Chinese locals switched into patriotic buying mode.”

“A green China coupled with an unexpected increase in new jobs created sent positive ripples through the local bourse,” Ms Lam said.

Australian Bureau of Statistics data today showed the official jobless rate tick up to 6 per cent in June, albeit from a downwardly revised figure in May. But the figure beat economists’ forecasts of 6.1 per cent.

“The Australian dollar was also supported by an encouraging unemployment print, boosting the dollar upwards of half a US cent,” Ms Lam said, to the mid US74c range.

Meanwhile, the series of sharp declines in the Chinese markets has also triggering a sell-off in commodities, with iron ore the worst hit overnight, plunging 11.13 per cent to $US44.10 a tonne.

It was one of the worst sessions for the iron ore price, but mining stocks avoided any damage in today’s trade, leading the market higher.

BHP Billiton gained 1.77 per cent to $25.88 and Rio Tinto lifted 1.66 per cent to $50.89. Fortescue rallied 6.57 per cent to $1.785, while South32 was up 1.74 per cent to $1.755.

Meanwhile, US oil prices fell for the fifth session in a row as domestic crude stockpiles rose again.

But energy stocks were spared from major damage, declining only 0.14 per cent as a sector. Woodside lost 0.3 per cent to $33.52 while Santos was up 0.4 per cent to $7.48.

IG chief market strategist Chris Weston said selling on the local market had become quite stretched. “I think this has played into today’s afternoon rally,” he said.

“A lowly 20 per cent of Australian stocks were trading above the medium-term 50-day moving average and there are only a few times in the last five years where this percentage has been as low as this. We have always seen a counter rally.”

Financials were down, with the big four banks in the red. ANZ dipped 0.19 per cent to $32.21, Commonwealth Bank subtracted 0.2 per cent to $85.60, National Australia Bank gave up 0.6 per cent to $33.13 and Westpac slid 0.84 per cent to $32.88.

Consumer staples were 0.4 per cent softer collectively. Woolworths slipped 1.79 per cent to $26.83, while Wesfarmers lifted 0.48 per cent to $39.91.

Meanwhile, Qantas was up 1.49 per cent to $3.40 after the consumer regulator gave it interim authorisation for an expansion of its agreement with American Airlines. Telstra closed 0.32 per cent higher at $6.18.

Looking ahead, tomorrow the ABS will release data on local housing finance.