Prime Minister Tony Abbott says "it's important that people don't hyperventilate" after the Australian sharemarket suffered its worst day on Monday since the global financial crisis.
It comes after the Australian sharemarket was hit by $60 billion in losses, on the back of major slump in China, which has sparked heavy losses across Asia.
Mr Abbott said he had been briefed by Reserve Bank governor Glenn Stevens on Tuesday.
"I think it's important that people don't hyperventilate about these type of things," Mr Abbott said from Thursday Island on Tuesday, where he is visiting Indigenous communities.
"Certainly I've been talking to Treasurer Joe Hockey about the stock market issues over the last couple of days.
"I had a briefing from the Reserve Bank governor this morning. I've been briefed by senior officials while I'm up here in the Torres Strait."
Mr Abbott said stock market corrections occur from time to time.
"It is not unusual to see bubbles burst in particular markets and for there to be some flow-on effect in other stock markets, but the fundamentals are sound," he said.
"While the Chinese economy is slowing, the US economy is gathering speed.
"The European economy is gathering speed.
"Not as much speed as we'd like, but certainly the worst is very much over for Europe and our economy continues to perform quite well."
Treasurer Joe Hockey appeared on breakfast TV on Tuesday to push for calm, saying "there is no crisis, it is a correction" and he was meeting with G20 finance ministers and central bank governors next week "to deal with these sorts of issues".
Mr Hockey told the Nine Network he had faith in the economy, arguing the global economy is in better shape today than it was 12 months ago
Mr Abbott was also asked whether he had replied to a text from ABC managing director Mark Scott apologising for an offensive tweet that was broadcast on the ABC panel show Q&A last night.
"I haven't had a chance to respond to the text message that I had, because it's been a very busy morning," he said.
"I just hope that the ABC management get on and do what they said they were going to do with that program.
"I think it is a bit out of control and I think it's important for the ABC not just to talk about tighter management structures, tighter management control on that particular program, but actually do it."
