The S&P/TSX composite index closed up 200.91 points to 11,863.50, in a session partly characterized by playing catch up with U.S. markets after the Civic Holiday. The TSX Venture Exchange rose 3.61 to 1,190.56.
The Canadian dollar ended the day above parity, at 100.25 cents US, up 0.44 of a cent from Friday's close.
Much of the activity was in commodities stocks, with metals and mining stocks leading the way, up 4.6 per cent. HudBay Minerals Inc. (TSX:HBM) stock was up 7.5 per cent, or 63 cents, to $9.02.
The September copper contract moved up nearly 5.2 cents to US$3.44 a pound while December gold dropped $3.40 to US$1,612.80 an ounce.
Energy stocks gained 2.9 per cent with the September crude contract on the New York Mercantile Exchange ahead $1.47 to close at US$93.67 a barrel, closing at its highest level in two months.
On Wall Street, gains were driven by a renewed sense of optimism about the economy, with better earnings results than expected from several U.S. companies and expectations that central banks will act to support the economy.
The Dow Jones industrial average increased 51.09 points to 13,168.60 and the broader S&P was up 7.12 points to 1,401.35. Nasdaq gained 25.95 points at 3,015.86.
Of the 407 companies in S&P 500 that reported earnings through Monday, 65 per cent beat Wall Street expectations, according to S&P Capital IQ. More than 40 per cent have reported double-digit growth.
Meanwhile, U.S. employers posted the most job openings in four years in June, a positive sign that hiring may pick up. The U.S. Labour Department said Tuesday job openings rose to a seasonally adjusted 3.8 million in June, up from 3.7 million in May. That's the most since July 2008. Layoffs also fell.
The job openings data added heat to optimism over the U.S. jobs market, which already had a dose of positive news last Friday when observers were surprised to see the U.S. economy generated 163,000 jobs last month, better than the 100,000 gain that was projected.
Ian Nakamoto, director of research at MacDougall, MacDougall and MacTier said that markets are in a "risk-on environment" after comments from U.S. and European central banks last week were first treated somewhat negatively, but appear to have left markets feeling a little better this week.
He said much of that is due to the U.S. jobs data last Friday.
"If it wasn't for ... the job creation data, I don't think we'd be up as much," he said. "(That) really sealed it."
Meanwhile, Statistics Canada said the value of building permits issued in June fell 2.5 per cent to $6.8 billion, largely due to a drop in Alberta and British Columbia. The drop follows a 7.1 per cent increase in the previous month.
In corporate developments, CIBC (TSX:CM) signed a deal to buy the private wealth management business of MFS McLean Budden (TSX:SLF), which manages some $1.4 billion in assets for high net worth individuals families, endowments and foundations. CIBC shares rose 57 cents to $73.81.
Brookfield Infrastructure (TSX:BIP.UN) formed a joint venture to acquire a 60 per cent interest in Brazilian toll road operator Obrascon Huarte Lain Brasil S.A. for $1.7 billion, including $600 million in assumed liabilities. Units gained $1.03 to $34.96.
Base and precious metals producer Imperial Metals Corp. (TSX:III) says increased shipments drove net earnings up to almost $12 million or 16 cents per share in the second quarter, from $8 million or 11 cents in the same 2011 period. Revenue soared to $69 million from $39.4 million. Shares in the company were up 3.1 per cent, or 26 cents, to $8.66.
In the media spectrum, TVA Group Inc. (TSX:TVA.B) nearly doubled its second-quarter profit. The broadcaster and publisher said net income attributable to common shareholders rose to $23.7 million or $1 per share, including $12.9 million or 54 cents per share from the sale of its 51 per cent stake in The Cave and 50 per cent stake in Mystery TV. Shares dropped five cents to $7.39.
And three major Canadian media companies have launched a campaign to oppose BCE Inc.'s (TSX:BCE) planned purchase of Astral Media Inc. (TSX:ACM.A), saying the deal would give Bell too much control over the country's broadcasting landscape.
The heads of Cogeco Cable Inc. (TSX:CCA), Eastlink and Quebecor Inc. (TSX:QBR.A) unveiled a new online petition against the proposed deal.