Stocks were pummelled from the outset, with the losses intensifying after domestic retail sales unexpectedly contracted in June.
No sector was spared from the rout, although resource stocks were hit the hardest amid fears a slowing world economy will sap commodity demand.
BHP and Rio Tinto weighed heavily on the sector, dropping more than 3% each.
However, gold stocks were among the few gainers after bullion rose to another record high. Newcrest finished up 1.8% for the day.
NAB was the worst performing big bank, down 3.2%. Macquarie fared even worse, tumbling 5%.
The ASX 200 plunged 101 points (-2.3%), settling at 4333.