The S&P/TSX composite index gained 58.24 points to 15,073.65 as Statistics Canada reported that retail sales rose by a better than expected 0.8 per cent in September, led by auto sales.
The loonie was ahead 0.29 of a cent to 88.87 cents US.
The rise in the Canadian dollar also came in the wake of a report from a major international organization that forecast the Bank of Canada would begin hiking its key interest rate as early as May 2015 — months ahead of when economists have been predicting.
The Organization for Economic Co-operation and Development said forecast that inflation will return to the central bank's two per cent target on "a sustained basis by late 2015."
It also said the Bank of Canada's key rate, currently at one per cent, would likely rise steadily after the May increase.
And in the U.S., data showed the American economy expanded at a faster than expected annualized pace of 3.9 per cent in the third quarter. Economists had forecast that this first revision to GDP would show growth slipped from 3.5 per cent to 3.3 per cent.
"The U.S. is on a good trajectory right now. The economy is moving in the right direction — it’s not going whole hog, full steam ahead (but) it's going at a good pace," said Sadiq Adatia, chief investment officer at Sun Life Global Investment.
U.S. indexes were largely little changed amid other data from the Conference Board which showed that its U.S. consumer confidence index unexpectedly fell to 88.7 in November from 94.1 in October.
The Dow Jones industrials was off 2.96 points at 17,814.94, the Nasdaq gained 3.36 points to 4,758.25 and the S&P 500 index was 2.38 points higher at 2,067.03.
The TSX energy sector continued to be a drag, down 0.85 per cent ahead of a key meeting Thursday of the OPEC oil cartel. Crude has been hit hard by a rising greenback that has depressed all commodities priced in U.S. dollars, as well as lower demand and rising supplies. Oil prices had risen to about US$105 a barrel last summer during a period of heightened geopolitical worries.
The focus is now on OPEC to see if it will cut production in order to support prices. But Adatia doesn't think it will make much difference.
"I don’t think you see much movement in oil even if you get a decent comment on Thursday," he said.
"I think we’ve kind of found a range here. So $75 to $80 is probably where we’re going to be sitting for a fair bit of time now."
On Tuesday, the January crude contract on the New York Mercantile Exchange dropped $1.69 to US$74.09 a barrel.
Other TSX sectors were higher with the gold group ahead about four cent as December bullion climbed $1.40 to US$1,197.10 an ounce.
The base metals component gained 1.85 per cent even as March copper fell three cents to US$2.98 a pound amid doubts that the interest rate cut unveiled by China's central bank last week will be enough to improve conditions to raise demand.
The consumer staples sector was ahead 0.67 per cent as convenience store operator Alimentation Couche-Tard (TSX:ATD.B) said its quarterly net income surged 25 per cent to US$286.4 million despite a dip in revenues to US$8.9 billion. Profits ex-items were 55 cents per share, a penny below expectations. Its shares ran ahead $1.52 to $39.70.