The program is called Monetary Outright Transactions and will see the ECB buy up government bonds on the secondary bond market, where previously issued securities are traded. ECB president Mario Draghi said the program is open-ended and will have no set limit on how much it can buy.
The S&P/TSX composite index ran ahead 149.6 points to 12,139.73, with extra lift coming from a double dose of positive U.S. economic data, while the TSX Venture Exchange was 12.03 points higher at 1,258.3.
The Canadian dollar was up 0.83 of a cent at 101.75 cents US.
The program comes with strict conditions — countries that want the ECB to buy their bonds must first officially ask for help from Europe's bailout funds and agree to "strict and effective" budget policy conditions.
The ECB has been pressured to take action after Spain and Italy became the latest countries forced to pay yields in the seven per cent range on their benchmark 10-year bonds earlier this year, a level that raised worries those countries could be forced to seek a bailout.
But analysts cautioned that this doesn't represent a fix for the eurozone debt crisis.
"It will help the markets in the short term but what it won’t do is solve the problem long term," said Sadiq Adatia, chief investment officer at Sun Life Global Investment.
"I think people are feeling good that there is some progress happening in the eurozone, no matter how small it may be and that will get people’s confidence a boost."
New York markets closed at multi-year highs.
The Dow Jones industrials surged 244.52 points to 13,292 — its highest close since December 2007 — amid positive employment news a day before the release of the U.S. government's August non-farm payrolls report. The Nasdaq composite index climbed 66.54 points to 3,135.81 and the S&P 500 index advanced 28.68 points to 1,432.12, its highest level since January 2008.
Payroll firm ADP said the American private sector created 201,000 jobs last month, much higher than an expected reading of 140,000.
Expectations for the U.S. government report on Friday have been modest, with economists forecasting the American economy created only about 127,000 jobs last month. Traders have been hoping that a weak report would further convince the U.S. Federal Reserve to embark on another round of stimulus.
"This is where the Fed has to walk carefully," added Adatia.
"There is still 100,000 job growth going on, so it’s not necessarily bad news and that’s where the Fed has to decide, OK we’re seeing job growth, maybe not as much as we were hoping for but it’s also not zero either. Nothing in my mind is definitively bad, to say they need to do quantitative easing."
Canadian employment data will also be released Friday. Statistics Canada is expected to announce the economy cranked out about 11,000 jobs.
Also, the Institute for Supply Management's reading on the U.S. service sector showed greater than expected expansion in August, rising to 53.7, from 52.6 in July. Economists had expected a reading of 52.5.
Gains were spread across all TSX sectors with the base metals group ahead about three per cent as December copper shed a penny and closed at US$3.52 after gaining six cents on Wednesday. First Quantum Minerals (TSX:FM) was up 79 cents at C$19.97.
Major Drilling Group International (TSX:MDI) jumped $1.07 or 11.72 per cent to $10.20 as the company reported record quarterly earnings of $31.9 million or 40 cents a share, up from $17.9 million a year ago.
Oil prices were also higher amid hopes that a fix for the eurozone government debt crisis would help get parts of Europe out of recession and improve demand prospects.
The October crude contract on the New York Mercantile Exchange gained 17 cents to US$95.53 a barrel, pushing the TSX energy sector up two per cent. Suncor Energy (TSX:SU) climbed 50 cents to C$31.85 while Canadian Natural Resources (TSX:CNQ) was ahead 73 cents at $30.09.
December bullion gained $11.60 to US$1,705.60 an ounce and the gold sector was ahead almost two per cent. Goldcorp Inc. (TSX:G) was up 85 cents at C$41.36 while Iamgold Corp. (TSX:IMG) gained 26 cents to $13.29.
The financials segment was up 0.9 per cent. Manulife Financial (TSX:MFC) was up 25 cents at $11.50 and Scotiabank (TSX:BNS) advanced 44 cents to $52.90.
The tech sector also provided lift with Open Text (TSX:OTC) ahead $1.73 at $55.01.