The S&P/TSX composite index ran up 56.99 points to 14,543.82 and the Canadian dollar was unchanged at 89.02 cents US.
New York markets were also higher with the Dow Jones industrials ahead 127.51 points to 16,805.41, the Nasdaq climbing 30.93 points to 4,483.72 and the S&P 500 index gaining 13.76 points to 1,964.58.
Markets have continued to claw back losses from the recent sharp sell-off.
The Toronto stock market just had its best week since late August with a gain of 316 points or 2.2 per cent, leaving it down seven per cent from its highs of early September. The TSX is still up 6.75 per cent year to date.
The Dow industrials gained 425 points or 2.6 per cent this week and the blue chip index is also well off the worst of the retracement, down just 2.75 per cent from its most recent record high Sept. 19.
Traders were encouraged as worries about the global economy lessened. Solid manufacturing data from China and the eurozone, along with a strong earnings report from heavy equipment maker Caterpillar, a company viewed as a global economic bellwether, were key factors during the week.
"We’re closer to the end of this than the beginning," said Bob Gorman, chief portfolio strategist at TD Waterhouse.
"People ask if its the start of a bear market — I say, no, this is simply a long overdue correction in a bull market and I think that, at the end of the day, earnings growth will be decent but not great and this will prevail and I think we’re going higher."
Investors began heading for the exits late last month on worries that indexes had run up too high amid worries about the health of the global economy. Buying sentiment was also hurt by the impending end of the U.S. Federal Reserve's key stimulus program of massive purchase of bonds.
The Fed's interest rate meeting is the major economic event for next week as markets will be curious if the Fed decides to postpone the end of its quantitative easing program, which has kept long-term rates low and underpinned a strong rally on stock markets.
A big loser in New York was Amazon. Its stock, already close to 52-week lows, fell 8.35 per cent as it posted a quarterly net loss of US$437 million, or 95 cents per share, far steeper than the loss of 76 cents per share analysts had been expecting. Revenue jumped 20 per cent to $20.6 billion, but that fell short of expectations as well.
Most TSX sectors were higher, led by a 2.45 per cent rise in consumer staples.
The TSX also found support from financial and tech stocks.
Selling pressure came from the resource sectors.
The energy component led TSX decliners, down 1.27 per cent as December crude dropped $1.08 to US$81.01 a barrel.
December copper was unchanged at US$3.04 a pound and the base metals group lost 0.7 per cent.
The gold sector slipped about 0.4 per cent as December bullion climbed $2.70 to US$1,231.80 an ounce.Suggest a correction