Traders also took in weaker than expected U.S. jobs data that suggested the Federal Reserve likely will be in no rush to start winding up a key element of economic stimulus.
The S&P/TSX composite index climbed 61.53 points to 13,248.06, its highest level since July 2011, led by mining stocks.
The U.S. Labour Department said job creation for September came in at 148,000 while the jobless rate dipped 0.1 per cent to 7.2 per cent. Economists had been looking for job gains in the neighbourhood of 180,000.
Also, August job creation was revised upward from 169,000 to 193,000.
The report was to have been released weeks ago but was held up by the partial U.S. government shutdown that ended last week.
There has been growing speculation since May about when the Fed might start to taper its monthly purchases of US$85 billion of assets, which have kept interest rates low and supported strong gains on many equity markets this year.
"If there was any doubt that that wasn’t to occur in the fourth quarter, I think basically today has removed that uncertainty entirely," said Stephen Lingard, portfolio manager at Franklin Multi-Asset Strategies.
"It is a 2014 story because underlying economic growth is not too strong. It really is on the precipice of being too weak; payrolls still haven’t recovered from the great financial recession."
The Canadian dollar was up 0.11 of a cent at 97.19 cents US as other data showed that Canadian retail sales edged up 0.2 per cent in August to $40.3 billion. Economists had expected a gain of 0.3 per cent.
New York gained momentum as other data showed that spending on U.S. construction projects rose at a solid pace in August, helped by further gains in residential building. Overall construction activity climbed to the highest level in more than four years.
Construction spending increased 0.6 per cent in August compared with July.
The Dow Jones industrials moved up 75.46 points to 15,467.66, the Nasdaq gained 9.52 points to 3,929.57 and the S&P 500 index closed up 10.01 points to another record at 1,754.67.
The TSX gold sector led advancers, up about 4.55 per cent while December bullion advanced $26.80 to US$1,342.60 an ounce. Barrick Gold (TSX:ABX) jumped $1.21 to C$20.47 and Goldcorp (TSX:G) ran up $1.26 to $26.99.
The base metals sector gained four per cent as the December copper contract on the Nymex rose three cents to US$3.34 a pound. Teck Resources (TSX:TCK.B) rose $1.17 to C$29.72.
The financials sector was 0.3 ahead per cent while CIBC (TSX:CM) improved by 1.06 cents to $86.41.
The energy component turned lower, down 0.48 per cent as oil prices went further into negative territory after other data showed rising inventories. The U.S. government said Monday, in a report delayed five days due to the government shutdown, that U.S. crude supplies rose by four million barrels in the week ended Oct. 11.
The November crude contract on the New York Mercantile Exchange decline $1.42 to US$97.80 a barrel, its lowest level since June 28. Canadian Natural Resources (TSX:CNQ) shed $1.06 to C$86.41.
Traders also focused on earnings news this week.
After the close Tuesday, Canadian National Railways (TSX:CNR) said quarterly profits climbed 6.1 per cent to $705 million. CN also posted adjusted earnings of $1.72 a share, a dime better than estimates. Revenue came in at $2.7 billion, against estimates of $2.644 billion.
Canadian Pacific Railway (TSX:CP) reports on Wednesday. CN had closed down 15 cents to $109.75, just under its 52-week high of $110, and CP gained 50 cents to $134.74.
Netflix reported Monday after the close that earnings quadrupled as the Internet video subscription service’s lineup of original programming helped attract 1.3 million more U.S. subscribers in its latest quarter. Netflix earned $32 million, or 52 cents per share, four cents higher than estimates.
Revenue rose 22 per cent from last year to $1.1 billion to match analyst projections. Its stock surged in after hours trading Monday and in pre-market trading Tuesday. But the shares were hit with a wave of profit taking and closed down down $32.47,or 9.15 per cent, to $322.52 after earlier running up as high as $389.16.
The string of gains on the TSX through late October has left the main index up about 6.55 per cent year to date, with advances this month led by the gold, base metals and financial sectors.
"I don’t know if we would definitively signal the all-clear but this Canadian market underperformance that we have seen, we do think is getting long in the tooth," added Lingard.
"It feels like we could be nearing an inflection point where at least Canada isn’t a significant underperformer as it has been lately."