02/05/2018 17:01 EST | Updated 02/05/2018 17:06 EST

Canadian Stock Markets Follow U.S. Into A Major Dive

The Dow Jones just had its worst day since the financial crisis.

Brendan McDermid / Reuters
Traders work on the floor of the New York Stock Exchange, Feb. 5, 2018. Stock markets had one of their worst days in years on Monday, amid fears that rising inflation and interest rates could put an end to the stock rally.

TORONTO — North American markets extended last Friday's slump, as the Dow Jones industrial average plunged nearly 1,600 points during today's trading session.

In New York, the Dow finished the day down 1,175.21 points to 24,345.75, or 4.6 per cent, erasing its gains for the year.

Percentage wise, it was the Dow's biggest drop since the financial crisis in 2008, BBC News reported.

On the Toronto Stock Exchange, the S&P/TSX composite index was down 271.22 points to 15,334.81 in a broad-based decline that saw all sectors finish in the red.

Watch: Why is the Dow plunging?

The Canadian dollar closed at an average trading value of 80.11 cents US, down 0.67 of a U.S. cent.

The S&P 500 index fell 113.19 points to 2,648.94 and the Nasdaq composite index dropped 273.42 points to 6,967.53.

The sharp drop began on Friday as investors worried that creeping signs of higher inflation and interest rates could derail the market's record-setting rally.

In commodities, the March crude contract fell US$1.30 to US$64.15 per barrel and the March natural gas contract was down 10 cents to US$2.75 per mmBTU.

The April gold contract gave back 80 cents to US$1,336.50 an ounce and the March copper contract was up three cents to US$3.22 a pound.

— The Canadian Press, with files from HuffPost Canada