A trader sits in front of the main trading board at the Frankfurt stock exchange, September 29, 2011.RALPH ORLOWSKI
Canada's benchmark stock index entered a bear market Monday afternoon, as investors worldwide dumped equities and commodities on concern Europe's debt crisis will slow economic growth.
The S&P/TSX composite index dropped 372 points, or 3.2 per cent, to 11,251.84 at the close of trading in Toronto. That pushed the index down more than 20 per cent from its 52-week high, a change that some traders use as a signal for a bear market.
The Dow Jones industrial average closed at 10,655.30, down 258.08 points, or 2.4 per cent. The broader S&P 500 closed at 1,099.23, down 32.19 points, or 2.85 per cent.
Financial markets worldwide have tumbled this year on speculation Greece and other European countries will default on their debt, threatening major losses at some of Europe's biggest banks and risking a global economic recession. Canada's benchmark index is on course for its second-biggest annual drop since 1990.
The S&P 500 turned positive briefly this morning after an index of manufacturing for September showed an unexpected gain, easing concern about a slowdown in the U.S. economy, the largest in the world.
All 10 industry groups in the S&P/TSX retreated, led by energy and mining stocks after prices for crude oil and copper dropped to their lowest levels in at least a year. Suncor Energy Inc. and Teck Resources Ltd. both sank more than 5.5 per cent. Financial companies also retreated, with Royal Bank of Canada losing 2.7 per cent and Toronto-Dominion Bank retreating 3 per cent.