11/07/2012 02:56 EST | Updated 11/07/2012 04:38 EST

Stock Market Plunge: TSX, Dow Hit Rough Patch Post Election

Trader Michael Zicchinolfi, center, works on the floor of the New York Stock Exchange Monday, Oct. 22, 2012. A weak forecast from heavy equipment maker Caterpillar and other poor earnings results weighed on the U.S. stock market in early trading. (AP Photo/Richard Drew)

North American stock markets tanked the day after President Barack Obama’s re-election, with Canada’s S&P/TSX index down 124 points, or more than one per cent, as of 2:30 p.m. ET.

The Dow Jones saw a steeper decline, falling 288 points, or more than two per cent.

UPDATE: As of the closing bell, the S&P/TSX composite index fell 130.61 points to 12,230.59.

Losses in New York were far steeper as the Dow Jones industrials tumbled 312.95 points to 12,932.73, the Nasdaq composite index dropped 74.64 points to 2,937.29 and the S&P 500 index fell 33.86 points to 1,394.53.

The Canadian dollar fell 0.44 of a cent to 100.39 cents US while Oil dropped $4.27 to US$84.44 a barrel.

The Canadian Press

Some analysts attributed the decline to a growing realization among investors that the Republican victory in the House of Representatives Tuesday night, coupled with Democrats holding on to the White House and Senate, could pose a major roadblock to resolving the fiscal cliff the U.S. faces at the end of the year.

However, others observers say the stock dive had nothing to do with the election, as the markets had already priced in the outcome of last night's vote. They point to the latest negative economic news out of Europe as the catalyst for the poor market performance.

The European Commission forecast the continent’s economy would flatline next year, and manage only to eke out small gains in 2014.


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