With commodity prices falling and the global economic outlook uncertain, Melbourne-based mining titan BHP Billiton (BHP) pulled the plug on its hostile takeover of rival Rio Tinto PLC (RTP), saying the proposed deal is of no longer in the best interest of shareholders.

Riddle me this: When is it good news when an analyst slashes his price target for a stock by 55%? Answer: When that “reduced” target price still represents a 59% gain. That’s precisely the scenario facing Companhia Vale do Rio Doce (ADR: RIO), the world’s biggest iron-ore producer.

BHP Billiton Ltd. (BHP) yesterday (Tuesday) received a formal complaint from the European Commission that detailed antitrust concerns about the mining giant’s proposed buyout of Rio Tinto PLC (RTP). Despite a sharp decline in commodities prices, BHP will likely make every effort to move on with the deal, which could mean selling some of its assets.

Commodity prices have been among the hardest hit by the wave of market panic. This has dragged down the stock of International Royalty Corp. (AMEX:ROY), which owns a portfolio of royalties from 80 mines around the world. Chris Mayer says this presents a great buying opportunity for investors. The company is not exposed to rising mining costs, yet it receives a slice of every ounce of metal that it pulled out. Chris says it’s “like a big bucket of call options…that don’t expire.”

Well that didn’t work out at all. Investors had a full weekend to think about the details of the worldwide plan to save markets. And then they became terrified. They sold shares and bought commodities.

The market is throwing away resource stocks amid panic on Wall Street.”You’d think the world will never again need gold, silver, platinum, oil, natural gas, uranium, copper, lead or zinc,” says Russell McDougal at Investor’s Daily Edge.

The old adage “the time to buy is when blood is running in the streets” remains true, however.

Russell says the stock shakeout provides a great opportunity for savvy investors. He recommends buying up quality resource stocks now and holding them for long-term profits.

As Wall Street descends into chaos, many investors are happy to sit on the sidelines holding cash. But there are still profits to be made for big-picture investors.

Chris Mayer says the next “megatrend” will be a $41 trillion global infrastructure boom. Urbanization on a massive scale in China and India requires huge construction projects. And this will create huge demand for building materials (like cement and steel) and basic commodities (iron ore, copper and nickel).

Chris says power-grid builder ABB (NYSE:ABB) and road-building equipment maker Astec Industries (NASDAQ:ASTE) are stocks to watch…

Mining is an expensive business. So if commodities prices fall sharply many mines are forced to close rather than operate at a loss. When this happens supply tightens and prices begin to recover. Chris Mayer says there are signs this is happening now… and a rally in mining stocks is on its way.

The dollar continued to rally against the euro yesterday.

It reached its highest level against the euro since January, after Jean-Claude Juncker, chairman of eurozone finance ministers, said the single currency was overvalued.

Dan Denning says the dollar rally will continue to push down key commodity prices in the short term. The problem is there’s little to support the dollar’s climb over time.

This makes mining stocks a bargain for the long-term investor.

The Reserve Bank of Australia (RBA) has cut its benchmark rate 25 basis points to 7%. This has sent the Aussie dollar and local stocks tumbling.

Chuck Butler says only one more rate cut is likely this year. Charles Delvalle, meanwhile, expects dividends on Austrialian companies BHP Billiton (NYSE:BHP) and Rio Tinto (ASX:RIO) to fall as the Aussie dollar weakens against the greenback.

Al Robinson at The Daily Reckoning Australia says the RBA is caught between fighting higher prices and a stagnating economy. But he says local mining stocks still a good bet…