Source: The Canadian Press

The S&P/TSX composite index jumped 212.18 points to 12,870.01 as investors also took in major dealmaking in the mining sector and the relaunch of General Motors as a publicly traded company in New York and Toronto.

TSX Venture Exchange gained 33.64 points to 1,987.63.

The Canadian dollar moved up 0.27 of a cent to 97.9 cents US. The greenback weakened and investors were relieved as hopes for some sort of Irish deal grew after the country’s central bank governor, Patrick Honohan, said he expects the Irish government will accept a loan worth tens of billions of euros.

Markets have been mainly lower over the past week on fears that Ireland would be the latest European country to face a possible default, following Greece’s near collapse in May.

Ireland has nationalized three of its six local banks following a collapse of the country’s real estate market and is struggling under the weight of a bailout expected to cost at least US$62 billion.

“Markets had a nice move in the September-October (period). A lot of people, including ourselves, thought it might be quite healthy to see a bit of a retracement back,” said Irwin Michael, president of Toronto-based I.A. Michael Investment Counsel Ltd. and manager of three ABC funds.

“We expect the market to remain volatile and sawtooth its way up. As you get into the end of November, early December most of the big institutions have taken all the gains and losses they wish for the year so the market gets increasingly thin and the path of least resistance is on the way up.”

The TSX base metals sector was ahead 5.18% as the December copper contract on the New York Mercantile Exchange rose 10 cents to US$3.83, still sharply lower from a recent high of US$4.04 on Nov. 9. Teck Resources (TSX:TCK.B) advanced $1.60 to C$50.29 while Quadra FNX Mining (TSX:QUX) gained 80 cents to $14.80.

The sector was also higher amid a deal that would form one of the world’s largest publicly traded producers of metallurgical coal, a key material used in making steel.

American resource company Walter Energy Inc. (NYSE:WLT) is in negotiations to buy Vancouver-based Western Coal Corp. (TSX:WTN) for stock and cash worth $3.3 billion. Western Coal shares soared $3.47, or 47%, to $10.85, still below the nominal value of $11.50 when the offer was announced.

The December crude oil contract rose $1.41 to US$81.85 a barrel following a drop of about 8% in the last week. The energy sector rose 2.22% and Suncor Energy (TSX:SU) rose $1.31 to $34.90 while Canadian Natural Resources (TSX:CNQ) climbed $1.19 to $39.99.

Gold stocks also headed higher as the December bullion contract in New York gained $16.10 to US$1,353 an ounce. Goldcorp Inc. (TSX:G) climbed 56 cents to $46.55 while Kinross Gold Corp. (TSX:K) headed 33 cents higher to $18.20.

Commodity prices declined sharply over the last week as the U.S. dollar strengthened while the Irish debt crisis grew more serious.

Investors also worried about lower demand from China as the country looked likely to make further moves — including interest rate hikes — to slow the economy after October inflation came in at a 25-month high.

But buyers felt more optimistic after China said it would impose price controls if needed on basic food items, boost vegetable production, give food subsidies to poor families and release stockpiles of grain, cooking oil and sugar to deal with higher inflation.

All sectors were higher save consumer discretionary stocks, with financials up 1.7%. Royal Bank (TSX:RY) advanced $1.14 to $54.28 and Manulife Financial (TSX:MFC) gained 36 cents to $15.69.

In other news from the resource sector, Emera Inc. (TSX:EMA), the owner of Nova Scotia Power, says a $6.2-billion deal has been reached to develop power from the proposed Lower Churchill hydroelectric project in Labrador. A link would also be developed to transmit electricity to Nova Scotia. Emera shares rose 92 cents to $30.55.

There was an enthusiastic welcome for General Motors’ initial public offering as the automaker returned as a publicly traded company with an offering that could be worth US$23 billion.

Besides trading in New York, General Motors is trading on the Toronto stock market under the symbol GMM.U.

Shares were offered at US$33 apiece, and it could be the largest IPO in history including the sale of preferred shares. The shares closed at US$34.01 on the TSX, well off its session high of $35.95.

New York markets were also lifted by U.S. data on weekly jobless insurance claims, which came in better than expected as the four-week average fell to its lowest level since late 2008.

The Dow Jones industrial average gained 173.35 points to 11,181.23.

The Nasdaq composite index was ahead 38.39 points at 2,514.4 and the S&P 500 index ran up 18.1 points to 1,196.69.

In other economic news, a snapshot of future economic activity made a solid showing in October. Statistics Canada’s composite index rebounded to 0.2% from a 0.2% dip in September.

The agency reported that six of the 10 components advanced, while three fell and one was unchanged. The financial components posted the largest gains, led by the stock market, while housing remained the weakest sector, reflecting a slowdown in the real estate market.