"What we're seeing now is irrational fear," said Peter Strachan of StockAnalysis. "It's raw fear."

"Once people get over that, from the Australian point of view, things aren't that bad."

Not only does Australia boast four of the highest rated banks in the world, even the plunging Australia dollar has kept commodities prices buoyant domestically, he said.

And the plunging Australian dollar has actually acted as a buffer on falling commodities prices.

"Certainly the falling Australian dollar will offset falls in Australian commodity prices," said Lachlan Shaw, commodities strategist at CommSec.

"Particularly for iron ore and coal price contracts which extend out to March 2009."

The benefits of the plummeting Australian dollar depends on the company and their foreign exchange hedge book.

"The exact timimg depends of the benefit depends on each company's circumstance."

"But certainly a falling Australian dollar is good for exporters."

The price of nickel fell down US$900, to US$14,250 a tonne overnight. However, this morning in Australian dollars, it actually gained $304 to $19,880, Mr Strachan said.

Copper, zinc and aluminum recorded the same disparity in price movements, falling in US dollars but gaining in Australian currency.

"It's illogical to sell Australian metals stocks because at the end of the day, they have costs in Australian dollars."

"You're paying wages in Australian dollars and getting paid in Australian dollars."

Gold miners were mixed, with Lihir up as much as 1.6pc, or 4 cents, to $2.55, and Newcrest down as much as 7.3pc, or $1.94, to $24.50.

In the energy sector, Woodside Petroleum was down as much as 5.6pc, or $2.75, to $46.25, while Santos was down 5.5pc, or 95 cents, to $16.25.

The retailers were also down - Woolworths was off as much as 1.2pc, or 33 cents, to $27.80, Wesfarmers was down as much as 2.9pc, or 80 cents, to $26.50 and Harvey Norman lost as much as 4.6pc, or 13 cents, to $2.68.