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SYDNEY, Aug 26 (Reuters) - Australian shares bounced from hefty early falls to finish higher on Wednesday as investors took heart from brief gains in Chinese equities and bought stocks cheapened by recent selling.
After opening losses as much as 1.6 percent, the S&P/ASX 200 index .AXJO reversed course mid-session when the Chinese sharemarket managed to post gains after a wild session that saw its main indexes moving in and out of negative territory.
The China markets have since moved down again in a reflection of the rattled investor nerves.
The Australian benchmark closed up 35.5 points or 0.7 percent at 5,172.8, but is still down 9 percent this month and off 4.4 percent for calendar 2015 so far.
New Zealand's benchmark NZX 50 index fell 35.5 points or 0.6 percent to finish the session at 5577.8.