The S&P/TSX composite index drifted 8.42 points higher to 12,361.2, while the TSX Venture Exchange added 1.21 points to 1,303.14.
"It looks to be too close to call and if it is as tight as it appears to be, then we won’t know the answer this evening anyway," said Gavin Graham, president of Graham Investment Strategy.
"So why would you want to be aggressive and take positions because you literally do not know what will come out the other end of it?"
The Canadian dollar ran up 0.5 of a cent to 100.83 cents US as the U.S. dollar turned lower.
The tone was far more positive in New York as traders hoped for more political certainty regardless of the winner. Positive housing data and a weaker greenback also helped push markets higher as the Dow Jones industrials rose 133.24 points to 13,245.68.
The Nasdaq composite index gained 12.27 points to 3,011.93 while the S&P 500 index was ahead 11.13 points to 1,428.39.
The latest opinion polls point to a narrow victory for incumbent Barack Obama.
But whichever way the contest plays out, the big hope is that the result will be clear enough to avoid a re-run of 2000 when the result was only known weeks later after a U.S. Supreme Court decision. Above all, traders hope that Democrats and Republicans will get down to the business of arriving at a budget agreement that will avert an automatic increase in taxes and spending cuts that could be imposed at the start of 2013.
This so-called fiscal cliff is particularly alarming as economists predict the subsequent shock from the higher taxes and deep automatic cuts in military and domestic spending would send the economy back into recession.
Graham added that investors will react very quickly if there isn’t a clear cut winner.
"The market would sell off and sell off hard," he said, noting that the New York market sold off six per cent in the five business days after it became apparent there was no immediate winner in 2000.
"Let’s assume it takes about as long as it did (in 2000) and runs all the way to the Supreme Court. Effectively, it’s not until early January that we have a clear winner. Which means nothing gets done on the fiscal cliff."
Traders were encouraged by data offering more evidence of a sustainable housing recovery in the U.S.
Real estate data provider CoreLogic says a measure of U.S. home prices jumped five per cent in September compared with a year ago, the largest year-over-year increase since July 2006.
The weaker U.S. dollar also helped drive commodity prices higher and the TSX gold sector was the biggest percentage advancer, up about 1.5 per cent as December bullion climbed $31.80 to US$1,715 an ounce. Iamgold (TSX:IMG) rose 58 cents to $15.22 while Goldcorp Inc. (TSX:G) was up 48 cents to $43.74.
The metals and mining sector was ahead 0.9 per cent as December copper added four cents to US$3.51 a pound. Teck Resources (TSX:TCK.B) advanced 65 cents to $33.53.
Uranium One Inc. (TSX:UUU) shares slipped five cents to $1.95 as the miner booked a quarterly loss of $61.6 million, or six cents per share, compared to a profit of $45.8 million, or five cents per share, a year earlier. The miner booked a $79.1-million writedown during the quarter related to the value of its shuttered South Zarechnoye uranium deposit.
Elsewhere in the sector, Inmet Mining Corp. (TSX:IMN) said Tuesday it would not be buying any shares of Petaquilla Minerals Ltd. (TSX:PTQ) after a hostile takeover bid failed to garner enough support by its deadline. Petaquilla shares tumbled 23.44 per cent to 49 cents while Inmet shares gained 80 cents to $56.76.
The energy sector was slightly higher while the December crude contract in New York moved surged $3.06 to US$88.71 a barrel. Canadian Natural Resources (TSX:CNQ) gained 33 cents to $30.20.
Penn West Petroleum Ltd. (TSX:PWT) stock was down 41 cents or 3.53 per cent to $11.19 after the company announced four senior executives including the chief operating officer have left.
The industrials sector was lower with Canadian National Railways (TSX:CNR) down 52 cents to $87.04. But Air Canada (TSX:AC.B) shares ran up 11 cents or 6.11 per cent to $1.91 after Pi Financial increased the carrier's target price from $1.80 to $2.50. They currently have a buy rating on the stock. The airline also reported record passenger loads Monday, saying planes in its domestic and international system were 82.9 per cent full in the month, up 3.5 percentage points from a year ago. Air Canada reports earnings on Thursday.
The tech sector was the leading decliner with CGI Group (TSX:GIB.A) off $1.37 to $24.61.
Patent licensing firm Wi-LAN Inc. (TSX:WIN) says quarterly net income was US$2.2 million or two cents per share, down from US$7.3 million or six cents per share a year ago. Revenue fell to US$21.3 million from US$27.8 million. The company cited the timing of licensing payments as a major reason for the decreases. Its shares drifted 22 cents lower to $5.00.
Greece was also in focus as legislators prepare to vote on a €13.5-billion package of spending cuts and tax increases over the next two years that are needed in order to secure another round of rescue loans.
The outcome of the vote Wednesday is far from certain due to disagreements in the five-month-old coalition government and a reluctance among centre-left legislators to approve yet more austerity measures. But the rejection of the savings package would leave Greece facing the threat of a default on its mountain of debt that could force it to eventually exit the euro bloc.