10/21/2016 11:58 EDT | Updated 10/21/2016 12:08 EDT

Loonie Dives On News Canada-EU Trade Talks Have Broken Down

Loonie loses two-thirds of a cent U.S. on bad trade news.

TORONTO — The loonie took a dive this morning amid reports that Canada's trade minister had walked out of talks aimed at salvaging a major agreement with the European Union.

The Canadian dollar was at 74.98 cents, down 0.65 cents from the previous close, about two hours after stock markets opened.

It had been above 75.5 cents US before the reports that Trade Minister Chrystia Freeland walked out Friday on talks aimed at convincing the holdout Belgian region of Wallonia to agree to the EU's wide-ranging free trade deal with Canada.

A placard reads "Stop CETA - it's enough" during an anti-CETA protest in front the Walloon parliament in Namur, Belgium on October 21, 2016, during a meeting on CETA (the EU-Canada Comprehensive Economic and Trade Agreement). (Photo: Bruno Fahy/AFP/Getty Images)

Sources inside Freeland's office confirmed that the minister "walked out" on the talks with Wallonia's leaders in Brussels — and the despondent-sounding statement that followed suggested the deal is all but dead.

"I personally have worked very hard, but it is now evident to me — evident to Canada — that the European Union is incapable of reaching an agreement, even with a country with European values such as Canada, even with a country as nice and as patient as Canada," the statement read.

At the Toronto Stock Exchange, the S&P/TSX composite index was up 56.81 points at 14,904.73, with most sectors showing gains.

In New York, the Dow Jones industrial average lost 87.11 points to 18,075.24, while the S&P 500 index lost 5.43 points to 2,135.91. The Nasdaq composite rose 8.04 points to 5,249.87.

The December crude contract fell 13 cents to US$50.50 per barrel and November natural gas lost 11.5 cents to US$3.03 per mmBTU.

The December gold contract fell 50 cents to US$1,267.00 an ounce and December copper contracts fell nearly a cent to US$2.09 a pound.

— With files from Mike Blanchfield, The Canadian Press

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