The S&P/TSX composite index recovered from negative territory in the final minutes to post a small gain of 0.97 of a point at 12,825.42.
The Canadian dollar jumped 0.31 of a cent to 96.95 cents US.
The financial markets settled down somewhat after President Barack Obama said in a television address Tuesday night that the United States would refrain from a military strike on Syria after the Middle Eastern country agreed to a Russian proposal to hand over its chemical weapons.
The development followed weeks of tensions after the U.S. threatened military action against Syria for an alleged sarin gas attack on Aug. 21 that killed 1,429 people in a Damascus suburb. The Syrian government has denied it was responsible.
With Damascus indicating its support for the Russian plan, investors have largely breathed a sigh of relief that a military strike with all the possible regional repercussions may be averted. Geopolitical uncertainties, particularly when related to the oil-rich Middle East, are rarely conducive to risk-taking in the investing community.
U.S. indexes were mixed as the Dow Jones industrial index registered a solid three-digit gain of 135.54 points to 15,326.60, while the S&P 500 climbed 5.14 points to 1,689.13.
The Nasdaq was down 4.01 points to 3,725.01, a day after Apple Inc. (Nasdaq:AAPL) announced two new models of its popular iPhone — including a lower-priced version aimed at emerging markets. It seems investors may have been disappointed by the announcement, as Apple shares closed down more than five per cent at US$467.83.
Analysts don't expect much big movement on Wall Street until next week's two-day meeting of the Federal Reserve, when the central bank may decide when it will begin rolling back its $85 billion in monthly bond purchases.
Some believe changes may be coming to the so-called quantitative easing policy, which has buoyed markets. However, Derek Holt of Scotiabank said no one is expecting any drastic announcements.
"Part of the debate is how much and when," said Holt, vice-president of economics at the bank.
"We've always been in the camp that they do so later for various reasons. I don't think they need to rush to cut back purchases now because their concerns about froth in financial markets have dissipated somewhat."
Holt said this is supported by recent data from the U.S. that showed the economy is not doing as well as expected.
"The bigger issue is we've seen some weak data on the U.S. economy going into the third quarter with the falling home sales, the falling durable goods orders (and) weak employment report with the downward revisions," he said.
"The general point is the data is suggesting that the economy is responding negatively to higher interest rates so that might make the Fed a little bit nervous about pulling back on stimulus just yet."
About half of the sectors on the Toronto Stock Exchange were down with small losses. The telcom sector was the leading decliner at 0.57 per cent as shares in Bell Aliant (TSX:BA) fell 1.85 per cent, or 49 cents, to $25.96.
The info tech sector saw the second-largest drop, 0.51 per cent, as BlackBerry shares fell more than five per cent, or 59 cents, to $10.74. The stock has been turbulent over the last week following rumours of a possible sale of the troubled smartphone maker.
Meanwhile, consumer staples was the leading advancer, up 0.64 per cent, boosted by a surge in shares of Dollarama (TSX:DOL). The discount retail chain beat analyst expectations as its second-quarter profit climbed 20 per cent to $59.8 million despite slightly lower margins as a result of expansion.
The Montreal-based retailer, which has more than 800 stores focused on items sold for between $1 and $3 each, earned 82 cents per share for the period ended Aug. 4, up from 66 cents per diluted share a year ago. Sales increased 16 per cent to $511.3 million.
Commodities were somewhat flat, as December gold bullion fell 20 cents to US$1,363.80 an ounce and December copper was unchanged at US$3.26 a pound. The October crude contract was up 17 cents to US$107.56 a barrel.