North American stocks solidified their rally on Monday, buoyed by higher oil and gold prices and signs of optimism about the U.S. economy.
The Canadian dollar fell .17 of a cent to 73.84 cents US, but the TSX was set to wipe out the losses it has had since the beginning of the month.
The Toronto index was up 109 points to 12,907 after the federal government announced it had ironed out legal details on Canada's free trade deal with Europe.
On the first day of trading in February, the TSX closed at 12,607 and it's been down more than three per cent in the volatile trading that has marked this month and January.
The Dow rose 45 points to 16,685 and the S&P was up six points to 1,954. The broader S&P index is approaching its first monthly gain since November, on sentiment that the U.S. economy was stronger than some investors had feared.
Gold, oil rise
The February gain has been led by the materials sector, which includes mining companies that have been helped by a surge in the price of precious metals. The price of gold has climbed 10.5 per cent this month and silver is up 4 per cent.
Oil also made gains, with West Texas Intermediate crude up 97 cents to $33.75 US at midday.
The U.S. dollar has fallen in the past week, helping both commodities prices and oil prices.
China's central bank guided the tightly controlled yuan sharply lower on Monday morning, contributing to big falls in Chinese stocks.
China's move on bank reserves
Later, the People's Bank of China cut the required reserve ratio for all banks by 50 basis points to 17 per cent in an attempt to inject more money into its slowing economy. That is still the highest reserve level in the world.
Global stock markets were mixed and did not share the optimism that emerged in North American trading.
They were weighed down by the failure of the world's leading economic policymakers at the G-20 to announce any new measures to boost the global economy.
Finance ministers and central bankers of the Group of 20 rich and developing pledge more "growth-friendly" tax and spending policies in a vague statement at the end of a weekend meeting.
But investors were disappointed that no specific measures were mentioned.
The Shanghai market dropped 2.8 per cent, Germany's DAX and the FTSE were down slightly and the Euro Stoxx index rose a modest 16 points.
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