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The Canadian dollar blood-thirsty 2.12 cents US on Thursday, with its official close at 93.65 cents US, as long as the Dow Jones suffered its largest drop in a single day since February 2009.

Canada’s currency has shed roughly four cents in merely a week, and is off by seven cents since April, at what time it briefly touched par.

Traders on the floor of the New York Stock Exchange watched Thursday while the Dow fell 3.6%. (Richard Drew/Associated Press)

The loonie is essence dragged down by two factors: a flight to the perceived preservation of U.S. money, and a general worry that high European offence loads will eat into global economic expansion and reduce demand as antidote to Canadian commodities.

“There’s a question out there now that potentially we could exist talking about a collapse of the eurozone or countries breaking gone from the euro,” said Tim Quinlan, an economist at Wells Fargo & Co.

Despite Canada’s relating to housekeeping strength compared to most other countries, the loonie has now fallen stingily four cents in little more than a week. It’s etc. nearly seven cents since late April, when it hovered near likeness with the U.S. dollar.

“Canada is as unaffected as a fatherland can be but that’s not to say it’s completely simple, because ultimately as we learned in the credit crunch, if things were to be in possession of really quite bad, you do see every country in the universe sucked into this thing,” said Eric Lascelles, chief strategist at TD Securities.

“It’s not a recital whatsoever against Canada, against the Canadian economy or against the general reception directly — it really is a natural consequence of crisis which without details results in a flight to safe-haven currencies and, rightly or erroneously, the U.S. dollar is that currency right now,” said Lascelles.

“While the loonie appears to have existence taking it on the chin, that doesn’t mean it won’t sudden blow right back up to parity when the hurricane of uncertainty dies from a thin to a dense state and traders climb out of their risk-aversion bunkers, Scotia Capital circulation strategist Camilla Sutton wrote in a note to clients.

“Though we tarry to believe that the medium-term outlook for the U.S.-Canadian dollar is whole for another run at parity, until risk aversion abates [the U.S. dollar] is weak to a push higher” against the loonie, Sutton wrote.

Dow Jones sinks to 10,068.01

Equities took the loonie’s tend, sinking out of the gate.

The benchmark S&P/TSX complex index closed down 259.82 points at 11,405.95, its sixth direct day of losses. It is now down 2.9 per cent from its set a ~ on at the beginning of the year.

In New York, the Dow Jones Industrial Average shedded 376.36 points, or 3.6 for cent, to 10,068.01.

The Nasdaq composite index finished on the ground 94.36 points, or more than four per cent, to 2,204.01 while the S&P 500 index declined 43.46 points to 1,071.59. Both exponents have now lost 10 per cent since their high for this year forward April 23.

In addition to European debt worries, investors seemed rattled in all parts of the U.S. Labour Department revealing Thursday that initial claims notwithstanding jobless benefits rose by 25,000 to 471,000 last week.

July oil closed below the horizon $1.86 at $68.01 US a barrel. Gold settled at $1,187.80 US some ounce, down $4.80.

With files from The Canadian Press