Australian stocks shifted into reverse late Monday after getting an initial bounce from the long-awaited US bail-out package.

The ASX 200 slipped 97 points, or 2 per cent, to close at 4,807.

Initial enthusiasm evaporated as analysts digested the terms of a package that may cost US taxpayers 700 billion US dollars. The details of the package appeared to sap confidence.

Shares slid on low volumes despite the growing likelihood that the Reserve Bank of Australia will take the 7-per-cent interest rate lower when it holds its October board meeting next week.