The S&P/TSX composite index jumped 118.11 points to 13,747.52, as traders contended with a major miss in Canadian jobs creation.
The Canadian dollar was off the lowest levels of the session but still down 0.42 of a cent to 91.73 cents US as Statistics Canada reported that the economy shed 45,900 jobs last month instead of the 14,600 jobs economists had expected it to create.
Meanwhile, Wall Street was mainly lower after the U.S. Labor Department said there were 74,000 jobs created in December as opposed to the 200,000 that economists had forecast.
The Dow Jones industrials declined 7.71 points to 16,437.05 as investors weighed the possibility that the Federal Reserve won't be in any rush to accelerate its program for cutting back on a key stimulus program.
The Nasdaq was up 18.47 points to 4,174.66 and the S&P 500 index rose 4.24 points to 1,842.37.
There was one piece of good news in the U.S. data: November job creation was revised up to 241,000 from 203,000.
"If it wasn't for the big revision in the previous month, the markets would have taken this much harder," observed Wes Mills, chief investment officer at Scotia Asset Management.
"It shows you how volatile (jobs data are), when you revise from 203,000 to 241,000, maybe we get (December) revised up something over 100,000 and then the average on the two reports is not so bad."
Traders hoped that the U.S. jobs data would provide some direction on how the Fed plans to proceed on further tapering to its massive monthly bond purchases. The central bank decided in December to cut the key stimulus program from $85 billion a month to $75 billion, making further cuts contingent on economic performance, particularly the job market. The change came into effect this month.
"The pace of tapering is likely to be reviewed and possibly slowed down," added Mills.
Many traders have worried about the prospect of lower stimulus because much of the rally in global stocks over the past few years has been driven by the Fed's policy, which has kept long-term interest rates at historic lows.
Other recent economic data have painted a picture of a U.S. economy that is steadily improving. Exports hit a record level in November, lowering the U.S. trade deficit; businesses have ordered more manufactured goods and auto sales reached a six-year high in 2013.
Analysts now estimate that the U.S. economy expanded at a healthy annual rate of three to 3.5 per cent in the October-December quarter, up from earlier forecasts of a rate of two per cent or less.
The gold sector led TSX gainers, up about 3.7 per cent as uncertainty about the Fed's intentions sent bullion prices higher. The February bullion contract in New York rose $17.50 to US$1,246.90 an ounce. Barrick Gold (TSX:ABX) gained 58 cents to C$19.82 while Goldcorp (TSX:G) was 98 cents higher to $25.29.
The base metals sector was also a major advancer, up 1.3 per cent as March copper gained four cents to US$3.34 a pound. Nevsun Resources (TSX:NSU) was up 16 cents to C$3.87 and HudBay Minerals edged up 27 cents to $8.84.
Rail stocks rose alongside miners with Canadian National Railways (TSX:CNR) ahead 82 cents to $59.39 while Canadian Pacific Railway (TSX:CP) rose $5.88 to $167.07.
The energy sector climbed 1.28 per cent with the February crude contract on the New York Mercantile Exchange ahead $1.06 to US$92.72 a barrel. Canadian Natural Resources (TSX:CNQ) improved by $1.08 to C$36.19.
The tech sector was mixed with BlackBerry (TSX:BB) ahead nine cents to $9.56.
But shares in IT services provider CGI Group fell 2.5 per cent to $34.37 on heavy volume of 4.25 million shares after the Washington Post said the Obama administration will end the Montreal-based firm's contract for the problem-plagued health-care website. The Post and Bloomberg said the U.S. government is preparing to sign a 12-month contract worth about US$90 million with Accenture, which built a health exchange for the state of California.
The TSX had a strong week, rising 198.67 points or 1.47 per cent, paced by gains in the mining sectors, which were the worst TSX performers last year.
The Dow ended the week flat.