The local share market has staged a dramatic turnaround, finishing only modestly lower after earlier being on pace for its worst day in five weeks.
The benchmark S&P/ASX200 index was down as many as 127 points, or 1.4 per cent in the first hour of trading on Wednesday but climbed steadily in the afternoon to finish just 18.8 points lower at 8,785.1, a drop of 0.2 per cent from Tuesday's close.
The All Ordinaries fell 25.4 points, or 0.28 per cent, to 8,979.3.
The rebound came even as Iran said it had launched attacks on 85 US military sites in Bahrain and Kuwait, in response to US airstrikes targeting Iran's ports, missile and drone sites and air defences.
The US said it had launched those attacks in retaliation for the Islamic republic's alleged targeting of two tankers in the Strait of Hormuz.
The Australian dollar was buying 69.40 US cents at 5pm on Wednesday, down from 69.44 US cents at 5pm on Tuesday.
