Toronto stocks rebounded from earlier losses Wednesday as financial stocks rallied late in the session.

The S&P/TSX composite index climbed 38.19 points, or 0.28%, to close at 13,582.93.

The financials sector finished the day up 0.8% as CIBC rose $2.04 to $69 and TD Bank advanced $1.16 to $66.29.

The heavy weight energy index gained 0.33% as crude for February delivery dropped 66¢, or 0.7%, to close at US$95.67 a barrel on the New York Mercantile Exchange.

Encana Corp. rose 55¢, or 0.80%, to $69.35.

The TSX gold sub-index gained 1.61%, as the price of gold climbed to just under US$900 an ounce, strengthened by rising oil prices and a strong debut for Shanghai gold futures.

The February gold contract finished up US$1.40 at US$881.70 an ounce.

Yamana Gold Inc. jumped 35¢ to close at $15.85.

Six of the 10 TSX main group lost ground. The telecommunications group fell 1.27%, led by BCE Inc., which fell 0.18% to close at $38.29.

The consumer discretionary group lost 1.02% as s Thomson Corp. declined $1.22 to $37.79.

Among individual stocks, shares in MacDonald, Dettwiler and Associates Ltd. rose 15.29%, closing at $49.01 after it announced plans to sell its space and satellite business to U.S. defence contractor Alliant Techsystems for more than $1.3 billion.

Corus Entertainment Inc. increased its annual dividend 20% after first-quarter profits rose 7% to $39.4 million. Its shares lost $1.30 closing at $44.

Shares of troubled commercial printer Quebecor World Inc. slid below $1, falling 19¢, or 17.27%, to 0.91¢.

The junior S&P/TSX Venture composite index lost 45.69 points, or 1.62%, finishing the day at 2,774.52.

The Canadian dollar slipped 0.53 of a cent to close at US$99.03 as Canada Mortgage and Housing Corp. said the seasonally adjusted annual rate of housing starts in December decreased to 187,500 units, from 233,300 in November. However starts for 2007 are estimated at 229,600, surpassing the 2006 level.

In New York, markets rebounded after Goldman Sachs chief economist Jan Hatzius predicted a mild recession this year that will last two or three quarters.

The Dow Jones industrial average was up 146.24 points, or 1.16%, closing at 12,735.31. The S&P 500 was up 18.94 points, or 1.36%, at 1,409.13.

The Nasdaq composite index rose 34.04 points, or 1.39%, to settle at 2,474.55.