The Toronto stock market tumbled more than 125 points Monday, extending a run of losses as talks aimed at forming a new Greek government failed, raising worries the country may have to exit the euro-zone.
The S&P/TSX Composite Index plummeted 130.19 points, or 1.1%, off its lows of the day, to approach noon at 11,564.48
The Canadian dollar settled back 0.22 cents to 99.76 cents U.S.
The TSX fell 1.48% last week on top of a 3% slide the previous week, leaving the Toronto market about 2% below where it started 2012 trading.
The energy sector lost ground as Suncor Energy was down 59 cents to $28.16.
The base metals sector lost a lot as July copper was off eight cents to $3.57 U.S. a pound. Teck Resources lost 93 cents to $32.06.
Canadian uranium producer Cameco Inc. said Monday it will pay about $136 million U.S. cash plus assumed debt to acquire Nukem Energy, a German company that trades nuclear fuel products and services. Its shares fell 44 cents to $21.15.
The gold sector shed some strength as Barrick Gold faded 69 cents to $36.40.
Among financials, Royal Bank was down 64 cents to $53.36.
On the corporate front, Legacy Oil + Gas Inc. says its first-quarter revenue was up 37% from a year ago, rising to just under $95 million.
The Calgary-based company had $1.3 million of net income or one cent per share compared with a loss of $2.8 million or two cents a share in the first quarter of 2011. Its shares fell 29 cents to $7.37.
ON BAYSTREET
The TSX Venture Exchange slipped 23.43 points to 1,322.90, while the Nasdaq Canada deducted 4.65 points to 375.95.
All but one of the 14 Toronto subgroups broke for lunch in the red. Metals and mining got clubbed 2.4%, while energy stocks suffered 1.9%, and materials erased 1.7%.
The only holdout was in industrials, up 0.1%.
ON WALLSTREET
U.S. stocks tumbled Monday as investors have new reasons to fret over the political and economic stability of the euro-zone, and the safety of the U.S. banking sector.
Over the weekend, Greece's political crisis appeared to worsen as parties fight for dominance. The debate heightened fears that Greece could be forced to leave the euro-zone.
The Dow Jones Industrials sifted off 80.45 points to greet noon at 12,740.15
The S&P 500 faded 9.05 points to 1,344.34. The tech-rich Nasdaq Composite Index ducked back 10.61 to 2,916.93.
Shares of the nation's big banks continued their selloff from Friday.
JPMorgan, which was down 9% Friday, lost another 2% Monday after the bank announced the retirement of chief investment officer Ina Drew, who oversaw the unit responsible for the trading blunder, ahead of the open.
Fitch Ratings downgraded JPMorgan's debt after the closing bell on Friday, voicing a concern over a "lack of liquidity."
Stocks of rival Wall Street firms Morgan Stanley, Citigroup, Wells Fargo and Goldman Sachs all slid roughly 2% Monday, following their 4% losses Friday on the JPMorgan news.
Yahoo CEO Scott Thompson left the company Sunday, after it was found he padded his resume with an embellished college degree, ending his term there after just four months.
The Web portal company also announced it had reached a deal with activist shareholder Dan Loeb, the CEO of Third Point, who had initially disclosed the problems with Thompson's resume, as the company agreed to nominate three of four directors he had put forth for its board. Shares of Yahoo gained 2.7% in early morning trading.
Beauty company Avon Products announced on Sunday that it was considering a buyout offer from Coty Inc. The statement comes after Coty upped its offer last week and Warren Buffett's Berkshire Hathaway said it would back the purchase. Avon's stock jumped 4%.
Shares of online deal site Groupon surged nearly 11% on Monday, with earnings due after the bell. In recent months, Groupon has seen accounting problems, shareholder lawsuits and an examination by the Securities and Exchange Commission. Analysts surveyed by Thomson Reuters expect the company will report earnings of one cent per share on revenue of $531 million U.S.
Shares of Chesapeake Energy rebounded 7% Monday from their Friday selloff on news that Chesapeake might have to delay some asset sales, which are necessary to pay down its debt.
After Friday's close, the company announced it had arranged for a $3-billion U.S. unsecured loan from Goldman Sachs and affiliates of Jefferies Group. On Monday, the Wall Street Journal reported that activist investor Carl Icahn is expected to reveal he once again has increased his stake in the company to more than 5%.
In other news, investors made a dash out of debt securities Monday morning, with the yields on 10-year Greek bonds shooting up to 27.3%.
The yield on the Spanish 10-year bond climbed to 6.33%. Any rate above the 6% benchmark raises the risk that Spain might need a bailout of its own. Italian bond yields also rose, hitting 5.75%.
Meanwhile, the German bond yield slipped to a record low of 1.45%, further raising the spread between Germany and the weaker nations' yields.
Investors will also watch Germany after German Prime Minister Angela Merkel's party lost elections in the nation's largest state on Sunday. Merkel is due to face national elections next year.
The price on the benchmark 10-year U.S. Treasury shot upward, pushing the yield down to 1.78% from Friday’s 1.84%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil fell back another $1.58 to $94.55 U.S.
Gold futures for June delivery lost another $23.60 to $1,560.30 U.S. an ounce.
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