TSX down almost 300 points, retreat fuelled by Greek debt crisis

WATCH ABOVE: Increasing panic in Greece as country makes last-ditch effort to avoid financial collapse.

TORONTO – The Toronto Stock Exchange tumbled almost 300 points Monday, joining a global retreat on equity markets sparked by the Greek debt crises and fears over its possible effects on the euro and the world economy.

At midafternoon, Canada’s main index was down 299.29 points at 14,508.80 in a broad-based decline that was enough to more than erase the last of its gains for the year to date.

New York markets also took it on the chin, with the widely watched Dow Jones Industrial average plunging 273 points to 17,673.63. Meanwhile, the Nasdaq plummeted 90.60 points to 4,989.90 and the S&P 500 fell 33.70 points to 2,067.79.

On commodity markets, the August oil contract lost $1.17 to US$58.46 a barrel, but gold, seen as a safe haven in times of economic turmoil, saw prices rise, with the August contract adding $5.70 to US$1,178.90 an ounce.

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READ MORE: Greek debt talks go into weekend as default deadline looms

The loonie was off 0.30 of a U.S. cent at 80.81 cents.

WATCH: Bitcoin has seen a 120% increase in web traffic from Greece over the last few days after the country shut down banks in the midst of a financial crisis. Nicole Bogart reports.

The sharp drop on North American markets followed an even worst plunge in Europe. Germany’s DAX dropped 3.4 per cent, France’s CAC-40 sank 3.8 per cent and London’s FTSE 100 index fell 1.8 per cent.

All sectors on the TSX were lower Monday, with the heavily weighted financials sector the worst performer, down 2.47 per cent as bank stocks on both sides of the Atlantic were hit hard hit by the crisis.

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In Greece, both banks and the country’s stock market were ordered closed for a week after weekend talks between Athens and its creditors failed to reach a deal to free up 7.2 billion euros in rescue loans.

READ MORE: Economic turmoil has come to a head in Greece, again

Without that money, Greece appears certain to miss a $1.6-billion-euro payment due Tuesday to the International Monetary Fund. If the IMF fails to further extend the credit, the default could lead to Greece’s exit from the 19-member euro currency bloc and possibly the 28-member European Union itself.

There is concern among some investors that if Greece is unable to pay its debts, which total more than 300 million euros, it could have serious consequences for the global recovery and the long-term viability of the euro itself.

With talks at an apparent standstill, Greek Prime Minister Alexis Tsipras has called for a referendum next Sunday on budget and reform proposals his country’s creditors are demanding in exchange for the bailout money. Tsipras is urging Greeks to reject the proposals.

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