Toronto's main index extended early gains in afternoon trade Tuesday, amid solid advance by gold stocks and moderate recovery in financial and energy sectors.
The S&P/TSX composite index improved 52.71 points to end the day at 12,000.61.
The benchmark index retreated nearly 5% after touching a 19-month high on April 26, but recovered 2.18% on Monday in its biggest single-day gain since the start of 2010.
Safe-haven buying kept gold prices near record high as traders pondered if the $1-trillion U.S. loan package unveiled by European policy makers would suffice to ensure long-term financial stability in the euro-zone.
However, speculations that China may adopt monetary tightening measures to cool its booming economy kept sentiment in check. Data showed the country's inflation grew in April at the fastest pace in 18 months.
The Global Gold Index gained as Barrick Gold rose 4.2% to $46.85 and Kinross Gold advanced 7.2% to $19.13.
Encana gained 0.9% to $32.40 and Canadian Natural Resources slid 1%, even as crude oil prices edged higher.
Ivanhoe Energy shed 5.5% to $2.74. The Vancouver-based heavy oil producer said its first-quarter loss narrowed to $2.57 million U.S. from last year's $12.27 million U.S., benefiting from lower operating expenses.
Among financial stocks, BMO docked 0.2% to $60.35 and Scotiabank gathered 0.3% to $51.63.
Wealth management company CI Financial, which reported a 23% rise in first-quarter profit to $74.9 million, added 1.2% to $19.94.
Meanwhile, base metal stocks bucked the trend. The Diversified Metals and Mining Index fell, with Teck Resources down 7.7% to $36.48.
First Quantum Minerals dropped 5.1% to $69.75 even after reporting a surge in first-quarter profit to $146.2 million U.S. from $10.9 million U.S., driven by higher copper prices.
George Weston added eight cents to $73.75. The bakery and grocery giant reported first-quarter profit fell 95% to $42 million, reflecting the absence of a $883-million gain in the year-ago quarter from the sale of its U.S. fresh baked-goods business.
On the economic front, the IBD/TIPP Economic Optimism Index increased 0.6% in May to a reading of 48.7 from 48.4 in the previous month. The consensus estimate was for a rise to 48.9. Any reading below 50 indicates pessimism.
The Canadian dollar gained 0.26 cents to 97.92 cents U.S.
ON BAYSTREET
Nine of the 14 TSX subgroups were higher. Gold surged 5.3%, while materials gained 2.2%, and utilities climbed 0.9%.
The laggards were weighed by metals and mining, sliding 4.6%, global base metals, down 4.1%, and energy, which slid 0.6%.
The TSX Venture Exchange surged 21.82 points to 1,612.58, while the Nasdaq Canada index moved 9.62 points higher to 752.92.
ON WALLSTREET
In New York, equities seesawed Tuesday, losing steam late in a volatile session, as investors welcomed Europe's $1-trillion U.S. aid package, but showed caution amid the recent market turmoil.
The Dow Jones industrial average fell on the day 36.88 points, to 10,748.26, after having been down nearly 100 points and then up 89 points earlier in the session.
The S&P 500 index settled 3.94 points to 1,155.79. The Nasdaq composite index sneaked into the green 0.64 points to 2,375.31
Stocks lost steam in the last hour of trade as investors, cautious after Monday's huge rally, continued to digest the European aid package.
However, the worries of the last few weeks pushed investors into safe-haven areas such as the U.S. dollar and gold. COMEX gold for June delivery settled at a record high.
U.S. stocks rose Monday, joining stocks around the globe, after European leaders approved an almost $1-trillion U.S. rescue package aimed at containing the growing debt crisis and stabilizing the euro. The Dow gained 405 points, its biggest gain since March 23, 2009.
But the euphoria of Monday gave way to a more measured response Tuesday amid questions about whether the bailout package will work if Greece and other debt-plagued nations don't make other efforts to cut their growing deficits. Markets around the world slipped after also rallying Monday.
Stocks have become increasingly volatile over the last few weeks as the period of markets gently moving higher has given way to bigger intraday swings.
The CBOE Volatility index, or the VIX (VIX), Wall Street's fear gauge, slipped 1% after sliding 30% Monday, as investor anxiety increased.
During last week's selloff, culminating in the one-two punch of Thursday's "flash crash" and Friday's follow-up, the VIX rallied to 13-month highs as investors grew more panicky.
The House Financial Services Subcommittee on Capital Markets was discussing last Thursday's stock market roller coaster ride, in which a 350-point loss on the Dow became a nearly 1,000-point loss in under 10 minutes. The Dow erased two-thirds of those losses by the close, but investors remained rattled.
The intraday selloff was the biggest on a point basis in market history.
Executives from the nation's largest stock exchanges and the chairwoman of the SEC were expected to tell Congress that the ultimate cause of the crash remains a mystery.
In addition, regulators and exchanges have reportedly firmed up plans to institute "circuit breakers" on individual stocks in an attempt to prevent a repeat of last week's incident.
Greece requested $18.4 billion U.S. in funds Tuesday from the European Union (E.U.) and is due to receive $7 billion U.S. from the International Monetary Fund (IMF) Wednesday. In total, the nation is requesting access to around $25 billion U.S. of the over $140 billion U.S. the E.U. and IMF have pledged in support.
The funds mean Greece will be able to meet the May 19 deadline to pay back roughly $11 billion U.S. in debt.
However, the pledge of over $140 billion U.S. came with requirements that Greece implement more rigid austerity measures that have angered unions and caused rioting.
Worries that Greece's problems would hurt other struggling nations such as Portugal have created fears that a broad European debt crisis could cripple the burgeoning economic recovery.
Economically speaking, wholesale inventories rose 0.4% in March, the Commerce Department reported, after rising 0.6% in February. Economists thought inventories would rise 0.5%.
Treasury prices inched down, lowering the yield on the 10-year note back to Monday’s 3.54%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil eased 92 cents to $75.88 U.S.
Gold prices jumped $32 to $1,233 U.S. an ounce, an all-time record.
