09/09/2011 12:48 EDT | Updated 11/09/2011 05:12 EST

Dow, TSX close down 300 points

Fresh European debt fears and negative Canadian jobs data pushed North American stock markets deep into the red on Friday.

The S&P/TSX Composite Index lost 296 points to 12,387 when markets closed Friday afternoon. One of the major factors in the losses was a Statistics Canada report showing that Canada lost more than 5,000 jobs in August — the first negative number we've seen since March.

The loonie lost almost a cent to trade at 100.49 cents US in the afternoon, less than half a cent away from passing below parity. The loonie has been worth more than the U.S. dollar since late January.

Losses in New York were even steeper, with the Dow Jones Industrial Average down 303 points to 10,992. The major catalyst in New York was new worries over European debt issues. A report suggestedthe German government was moving to protect its banks against a Greek default.

The ECB's chief economist also resigned suddenly, citing personal reasons.

Oil was almost $2 lower a barrel to $87.21. Gold, which tends to rise during bad economic times, gained more than $2 to $1,860.

Investors had hoped that Federal Reserve Chairman Ben Bernanke would use a speech Thursday to hint at another round of stimulus. But that didn't happen.

"The markets appear to be coming to the realization that the Fed could well be running out of bullets in its fight to boost the U.S. economy," said Michael Hewson, markets analyst at CMC Markets.

Investors also did not appear to be encouraged by President Barack Obama's $447 billion plan for creating jobs as it's likely to prove difficult to get the proposed measures through Congress since Republicans control the House of Representatives.