After swinging wildly all day, the ASX rallied strong to defy market expectations and avoid a bear market for now

• The Australian sharemarket was on a rollercoaster again on Tuesday, with the ASX plunging nearly 4% in the first ten minutes of the day's session, before bouncing to finish more than 3% higher.

• It follows a 7.33% drop on Monday – the worst single day fall since the global financial crisis.

• Fears around coronavirus and its impact on global economies as well as a plunging oil price has only exacerbated economic fears, as investors grow jittery.

• Visit Business Insider Australia's homepage for more stories.

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Australian stocks are flying all over the place.

After suffering its worst day since the global financial crisis (GFC) on Monday, the bloodbath looked set to continue with investors bracing in the morning for another big fall.

ASX 200 futures had been pointing to a 6% fall, fuelled by coronavirus fears and an oil price that has fallen out of bed. Within the first ten minutes of opening, it looked like happening, with the index plunging almost 4%, before bouncing to recover much of the initial loss. Rallying in the afternoon, the market went on to finish 3.11% higher, against all initial expectations.

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Investors are clearly jittery, after Wall Street was itself awash with red. Overnight, all major US markets were down by 7.29% or more, with the loss of investor confidence expected to translate to Australia.

After 7.33% was wiped off Australia's market yesterday, another steep fall would have pushed the ASX into a bear market – characterised by a 20% fall or more – after a horror few weeks on global markets. A remarkable finish to a day of wild trading somehow averted that fate.

It comes as the coronavirus threatens key sectors of the economy, such as tourism, education and exports, as well as the earnings of companies reliant on global supply chains. The government has yet to announce details of a forthcoming fiscal stimulus package, which the Coalition has promised will target those parts of the economy hardest hit.

Dwindling demand and a dispute raging between the world's biggest oil producers, has also pulled the rug out from under the oil price, only exacerbating investor anxieties.

"The oil price collapse is yet another shock for fragile economies and markets to cope with – all against the background of turmoil in financial markets generally," BNY Mellon Investment Management chief economist Shamik Dhar said in a note issued to Business Insider Australia.

"Demand for oil had been weak anyway due to the impact of coronavirus, so Saudi Arabia’s decision to turn on the taps layers a supply shock on top of that. It’s hard to say how long this will last, but it doesn’t look like a short-lived development at the moment."

"The oil price fall also boosts market uncertainty – and obviously yesterday’s events demonstrate there’s a lot of fear about already. A sharp slowdown in world growth this year looks likely, possibly even global recession in the first half."

In just three weeks, more than $300 billion has disappeared from the ASX 200, with trillions more wiped from global markets.

More to come.