Japanese shares slide by 4 per cent | WHAT REALLY HAPPENED

Japanese shares slide by 4 per cent

Tokyo's benchmark index has dived nearly 4.0 per cent to close at a fresh six-month low.

It erased a morning rebound as Hong Kong and Shanghai extended losses on worries over China's stalling growth.

In wild trading, the Nikkei 225 at the Tokyo Stock exchange ended 733.98 points lower at 17,806.70 - its sixth-straight losing session and the lowest finish since mid-February - after briefly clawing back into positive territory by the midday break.

The broader Topix index of all first-section shares also swung between positive and negative territory, ending down 3.26 per cent, or 48.22 points, at 1,432.65.

The Nikkei had plunged more than 4.0 per cent at open, before pushing back into the black in mid-morning, then collapsing in afternoon deals after top Japanese officials called for calm in the market.

The index has lost 13 per cent over the past six sessions, as markets around plunge on the uncertain outlook for China, a key driver of global growth now seen as a major threat to the world economy.

In afternoon trading, Shanghai was down 6.70 per cent while Hong Kong was off 0.67 per cent.

"The Japanese government has been one of the most outspoken in their concerns over China's recent moves," said IG Markets' chief market strategist Chris Weston.