Photo: The Canadian Press. All rights reserved.

A man walks past a building in Toronto that used to house the Toronto Stock Exchange on August 18 2011. THE CANADIAN PRESS/Aaron Vincent Elkaim

The Toronto stock market plummeted more than 100 points in early trading Thursday as commodity prices fell amid reports from China and Europe showing a slowdown in manufacturing.

The S&P/ TSX fell 105.19 points to 11,654.15 while the TSX Venture Exchange was off 11.87 points at 1,242.7.

The Canadian dollar shed 0.25 of a cent to 97.87 cents US.

Wall street markets were mixed, with the Dow Jones up 10.71 points to 12,835.10, the S&P down 1.6 points to 1,354.1 and the Nasdaq losing 10.98 points to 2,919.47.

Appetite for stocks was also dented by the results of a monthly HSBC survey which showed that manufacturing in China, the world's No. 2 economy, has continued to contract. China's growth has been a pillar of the global economy in recent years, so its slowdown has been of particular concern to investors.

In the 17-country eurozone, the equivalent manufacturing survey, called the purchasing managers' index, fell to 44.8 points in June from 45.1 the previous month. A number below 50 indicates contraction. A related survey on the services sector also showed declining activity, suggesting a drop in GDP in the second quarter.

August gold prices dropped sharply, by $33.30 to US$1,582.50 an ounce, while July copper prices lost six cents to US$3.33 a pound.

Oil prices hovered around eight-month lows, losing 83 cents to US$80.62 a barrel after the U.S. Federal Reserve stopped short of implementing vigorous stimulus measures to boost waning economic growth and U.S. crude stockpiles rose unexpectedly.

The Fed on Wednesday extended an interest rate reduction program known as Operation Twist, pledging to sell $267 billion of short-term Treasury bonds and buy longer-term Treasurys through December. However, traders had been hoping for a more aggressive stimulus package known as quantitative easing.

Economic news from Canada included a report from Statistics Canada that retail sales dropped 0.5 per cent in April, much weaker than economists calls for a 0.2 per cent gain.

But most eyes are focused on the Finance Minister's announcement that mortgage rules would be tightened for the fourth time in as many years, lowering the amortization rate to 25 years from 30 years and dropping the level people can borrow against their house to 80 per cent from 85 per cent.