The Australian share market was trading more than five per cent lower at noon dragged down by the resources sector and after heavy losses from Wall Street.
At 1200 AEDT, the benchmark S&P/ASX200 was down 237.6 points, or 5.53 per cent, at 4,062.4, while the broader All Ordinaries fell 236 points, or 5.52 per cent, to 4036.5.
On the Sydney Futures Exchange, the December share price index futures contract was 290 points lower at 4095, on a volume of 22,686 contracts.
Macquarie Equities Brisbane adviser Helen Spencer said the market still was cautious.
"It's lower very much across the board but most of the weakness comes from the resources sector," Ms Spencer said.
"It's hard to say what is going to happen but for the short-term the market will depend on the results of economic data that comes out of the US each day."
Resources stocks have plunged on the local market amid expectations the financial turmoil will spark a global recession and reduce future demand for commodities.
Among the big miners, BHP Billiton was down by $3.01, or 10.13 per cent, at $26.69, while rival Rio Tinto declined $10.38, or 13.22 per cent, to $68.12.
Banking stocks were lower, too. National Australia Bank Ltd dropped $1.04, or 4.38 per cent, to $22.68, after it said it expected full-year cash earnings to be around $3.9 billion, as it brings forward its annual reporting date to provide clarity on its financial position.
Commonwealth Bank fell $1.55, or 3.54 per cent, to $42.20 and ANZ Banking Group decreased 76 cents, or 4.18 per cent, to $17.44.
Westpac dropped 61 cents, or 2.69 per cent, to $22.09 but its takeover target St George Bank lost $1.04, or 3.48 per cent, to $28.81.
Despair over the economy sent Wall Street plunging again overnight, propelling the Dow Jones industrials down 733 points, or 7.9 per cent, to their second-largest point loss ever.
Broader stock indicators also skidded. The Standard & Poor's 500 index fell 90.17, or 9.03 per cent, to 907.84, and the Nasdaq composite index fell 150.68, or 8.47 per cent, to 1,628.33.
In company news today, Woodside Petroleum Ltd, Australia's second biggest oil and gas producer, has reiterated its 2008 production forecast after delivering an 84 per cent increase in revenue for the third quarter.
Revenue climbed to $1.774 billion during the three months to September 30, underpinned by higher commodity prices and increased sales.
Woodside Petroleum was $1.26 or 3.22 per cent lower at $37.89, Santos declined $1, or 7.75 per cent, to $11.90 and Oil Search fell 30 cents, or 7.54 per cent, to $3.68.
At 1214 AEDT, spot gold was trading in Sydney at $US841 an ounce, down $US4.45 on yesterday's close of $US845.45.
Among local gold stocks, Newcrest Mining dropped $1.04, or 4.16 per cent, to $23.97, Newmont Mining added three cents to $4.64 and Lihir Gold dropped eleven cents, or 4.89 per cent, to $2.14.
In retail, Woolworths lost 63 cents to $25.76, David Jones lost 17 cents, or 5.45 per cent, to $2.95, and Coles owner Wesfarmers dropped $1.13, or 4.98 per cent, to $21.55.