Australia's treasurer says economy can withstand stock market "correction"

Australia's treasurer has moved to restore investor confidence on Tuesday, following the Australian stock exchange's sharp 4.1 percent fall which wiped 43 billion U.S. dollars off the value of the share markets on Monday.

The S&P/ASX 200 and All Ordinaries indices suffered their greatest one-day falls since January 2009 amid global rout, dropping to its lowest level in more than two years and prompting fear from investors of another global financial crisis (GFC).

Global markets collapsed Monday, with the Chinese stock markets experiencing their worst day in eight years as the benchmark Shanghai Composite Index tumbled 8.49 percent to close at 3,209 points.

The Dow Jones Industrial Average tumbled 588 points, or 3.58 percent, to 15,871, after sliding more than 1,000 points, or 6 percent at the opening. The S&P 500 shed 77.68 points, or 3.94 percent, to 1,893. The Nasdaq Composite Index sank 179.79 points, or 3.82 percent, to 4,526.

European equities also dived on Monday following previous session's deep decline, as the Stoxx Europe 600 was down over 6 percent and Germany's DAX fell 4 percent.

But Treasurer Joe Hockey moved to dispel the rumors of another recession, reassuring Australian investors on Tuesday that the nation's economy was able to withstand the falls.

"I'm absolutely confident, absolutely confident, that the fundamentals of the Australian economy and the global economy are still good, are still good. Without doubt, that is the situation." Hockey told the Nine Network on Tuesday morning.

Hockey said the loss in value was a "correction" and not the beginning of another global financial crisis.

"In fact there is no crisis now. It is a correction," he said.

Hockey added that Australia's economy was in a strong position to deal with recent market uncertainties.

"There are going to be gyrations, there is going to be volatility, so we've got to come back to the core business of the economy. In Australia last month 38,000 new jobs were created," he said.

The treasurer said he was meeting with other G20 nations' finance ministers and central bank governors next week, at a summit to discuss "the world coming together to deal with these sorts of issues." Endi