The Australian share market has fallen as much as 2.5 per cent in early trade following a massive late sell-off on Wall St.

The ASX 200 was off 1.8 per cent at 4,897 after 35 minutes of trade, and the broader All Ordinaries was 90 points lower at 4,952.

At its peak, today’s sell-off had wiped $38 billion off the market’s value, following a 1.3 per cent rise for Australian stocks yesterday.

All sectors of the market were in the red, with the major banks, retailers and commodity producers leading the declines.

• Why you aren’t as wealthy as you think you are
• ‘Sell all’: RBS warns clients
• A bombshell that could destroy ‘Debt Star’ banking

An independent research firm has said the rocky start for markets in 2016 has seen superannuation funds fall by around 2.5 per cent to 3 per cent in value.

SuperRatings said short term volatility in the market was causing some concern for funds, because of challenges locally and globally.

“The 2.5 per cent is a relatively steep drop but it’s not unprecedented by any stretch of the imagination, it may be more so in some of the listed markets where we’ve had a challenging start to the year in the ASX in particular,” Kirby Rappell, the general manager of research at SuperRatings told ABC News.

“It’s nothing like the returns we saw in the GFC at this stage … the second part to remember is there’s some buffers built into most portfolios.”

Global share markets have been routed since the start of the new year over lingering concerns about a slowdown in China.

Battered mining giant BHP Billiton plumbed fresh depths today with a 0.7 per cent slide to $14.66, while Rio Tinto was down 2.2 per cent and Fortescue 3.7 per cent to $1.5125.

Woodside Petroleum was hit by falling oil prices, sliding 2.4 per cent to $26.77.

Smaller and more vulnerable rival Santos had slumped 6.4 per cent to $2.91, below $3 for the first time since 1993.

Oil Search was off 3.2 per cent and Origin 3.4 per cent to $4.04.

The global benchmark Brent crude price fell below $US30 a barrel overnight, and was worth $US30.22 in early Asian trade, down 2 per cent.

The major banks were a big drag after a strong rally yesterday, with NAB and Westpac down around 2 per cent, CBA down 1.8 per cent and ANZ off 1.7 per cent to $25.02.

Retailers were also sold down – Woolworths was 1.8 per cent lower at $22.83 and Wesfarmers was down 1.2 per cent, even as it looks to expand its hardware business into the UK with the possible acquisition of Homebase.

Harvey Norman and Myer had falls of nearly 4 per cent.

The Australian dollar was caught in the risk sell-off, sliding back to 69.4 US cents.

After a positive start, US stocks plunged in late trade driven by oil price weakness and poor consumer spending.

Some positive trade data from China boosted sentiment at the beginning of the session on Wall Street.

However, losses for the online retailer Amazon have led the broader sector down, acting as a drag on the S&P 500.

By the close, the Dow Jones Industrial Average was down 2.2 per cent to 16,151.

The benchmark S&P 500 was 2.5 per cent lower at 1,890 and the Nasdaq had tumbled 3.4 per cent to 4,526.