The Australian share market has rebounded from its early losses due to big gains by the miners, strength on China’s market and better-than-expected jobs figures.

The market closed flat after suffering falls of more than one per cent in morning trade.

The fall came as the Shanghai Composite Index plunged 3.8 per cent early in the day, continuing its recent volatile run despite measures from China’s government.

But Chinese shares soon recovered to make strong gains, and the local market also picked up.

Philip Capital senior client adviser Michael Heffernan said local traders were bargain hunting after recent falls, and couldn’t resist the low prices of the big miners in particular.

BHP Billiton gained 45 cents to $25.88, Rio Tinto climbed 83 cents to $50.89 and Fortescue Metals rose 11 cents, or 6.6 per cent, to $1.785, despite weaker iron ore prices.

“It was good to see some stability in China today but I think the market will continue to fall,” Mr Heffernan said.

Also contributing to the turnaround for local shares was the latest jobs figures, showing a better than expected 6.0 per cent unemployment rate in June.

All four banks closed weaker, but well above their earlier lows.

ANZ dropped six cents to $3.21, Commonwealth Bank lost 17 cents to $85.60, National Australia Bank shed 20 cents to $33.1 and Westpac was 28 cents weaker at $32.88.

KEY FACTS

* At 1615 AEST on Thursday, the benchmark S&P/ASX200 index was up 1.5 points, or 0.03 per cent, at 5,471 points.

* The broader All Ordinaries index was down 0.2 points at 5,456.3 points.

* The September share price index futures contract was 18 points higher at 5,419 points, with 32,772 contracts traded.

* National turnover was 1.66 billion securities worth $5.4 billion.