Investors in Canada took and wait-and-see attitude Monday, while their U.S. counterparts showed they were already in the holiday mood.

The Toronto Stock Exchange S&P/TSX composite index rose 65.18 points or 0.83% to 7,924.57, while the TSX Venture Exchange composite index was up 19.48 points to 1,709.93.

U.S. stocks, on the other hand, soared. The Dow Jones industrial average rose 116 points, or 1.19%, to 9,899. The Standard & Poor’s 500 Index gained 12 points, or 1.1%. The technology-focused Nasdaq Composite Index jumped 28 points, or 1.45%, to 1,989. The Dow and S&P 500 closed at 18-month highs, while the Nasdaq hit a 22-month closing high.

Market observers said Canadian investors were holding off until they see Tuesday’s decision on interest rates. Few economists expect the Bank of Canada will lower rates, despite signs that the Canadian economy is lagging that of the U.S.

“Our view remains that there will be no change in rates,” said RBC Financial Group assistant chief economist Derek Holt. “Magnificent strength being reported for the U.S. economy combined with a third quarter headline GDP number for Canada that was weak only because of a long needed inventory decumulation that itself helps to sow the seeds for sustainable growth have chased the bears into hiding of late. With inflation a dead issue for now and the economic outlook vastly improving over recent months, monetary policy in Canada is likely in a holding pattern for some time yet.”

Another bullish sign for Canada’s economy was the strong data from the Canadian construction sector. Statistics Canada said investment in housing rose 11.1% in the third quarter from a year earlier.

The Canadian dollar fell US0.19¢ to US76.98¢ after setting 10-year highs on Friday, while the euro reached a new high of $1.2042 against the U.S. dollar in early trading before settling to 0.8325.

Gold rose to $400.20, topping the magic $400 mark, before settling back to $398.80.

Gold stocks paced the TSX. Wheaton River Minerals, the day’s most active stock, rose 7%. Barrick, Kinross and Placer Dome also gained. Metal and mining stocks advanced, with both Inco and Falconbridge closing at 52-week highs. Techs were up, pushed by Nortel Networks, Celestica and Research in Motion. Consumer stocks were the TSX’s only negative sector today as Shoppers Drug Mart and Loblaw declined.

In takeover news, Pivotal Corp. continued to soar Monday after the Canadian software maker received a third offer. The shares rose by 21¢ to $2.74. Hong Kong-based Chinadotcom is offering $2 (U.S.) per share in cash or $2.14 in cash and shares through its subsidiary CDC Software Corp.

In the U.S., markets were spurred by a report showing U.S. manufacturing running in November at its fastest clip in 20 years. Strong holiday sales data also helped keep investors in a merry mood.

The Institute for Supply Management’s November index on U.S. factory activity rose to 62.8% from 57% in October, the best monthly performance in 20 years and surpassing expectations of a rise to 57.9%.

Seasonal factors were also a positive, as December is historically a strong month for stocks. Since 1950, the month is the year’s best for the S&P 500 Index — which happened to reach a new yearly high in intraday trading — and the second best for the Dow Jones industrials average, according to the Stock Trader’s Almanac. “The holiday season is certainly kicking in, in both shopping and the market,” said one U.S. trader.