Stock markets took a beating Friday, with the U.S. indexes dropping more than the Toronto benchmark index.

Hammered by a weak U.S. employment report and fears about the Hungarian economy, commodities and currencies also fell.

The TSX composite over the past month

The S&P/TSX composite index fell 242.26 points to 11,569.61, a drop of two per cent. The Dow Jones average dropped 3.1 per cent with a 324.06 point loss to 9,931.22, and the Nasdaq index lost 83.86 points, or 3.64 per cent, to 2,219.17.

The Dow's close was the lowest since Feb. 8.

Losses were widespread throughout the TSX, but the resource stocks were especially hard-hit. The diversified metals sub-index fell 5.3 per cent, and the energy sub-index fell 2.2 per cent. The real estate, financial and industrials sub-indexes all fell more than two per cent.

The markets were reacting to a U.S. report that showed job growth in May was less than expected and included many temporary workers.

Meanwhile, a spokesman for Hungarian Prime Minister Viktor Orban said the country's economy is in a "grave" situation and it's possible it'll have to default on its loans.

The Hungarian forint and the euro both dropped against the U.S. dollar. The Canadian dollar was sideswiped as the greenback rose, dropping 1.76 cents to 94.28 cents US.

The TSX composite over a year

Oil prices dropped with the concern about economic growth. Light, sweet crude oil for July delivery fell $3.10 a barrel to $71.51 US a barrel.

European markets closed down by as much as three per cent. The British FTSE 100 index dropped 89.37 points, or 1.7 per cent; Germany's DAX fell 124.55 points, or 2.1 per cent; and the French CAC-40 tumbled 110.72 points, or 3.1 per cent.

The stock-market losses Friday wiped out gains earlier in the week and left all three exchanges below the level they reached at the end of 2009.

Nevertheless, they're all ahead of the June 4, 2009, level. The Dow closed at 8,750 a year ago, the TSX at 10,477 and Nasdaq at 1,850.