The Toronto Stock Exchange surged sharply higher on Monday as new economic data from around the world heightened hopes of an economic recovery, and oil futures soared.

The S&P/TSX composite index soared 233.99 points, or 2.3%, to close at 10,604.06.

Earlier on Monday, Statistics Canada reported that real gross domestic product declined a hefty 1.4% in the first quarter. But the annualized rate of contraction, at 5.4%, beat market expectations.

On the TSX, energy stocks surged 4.6% as oil futures hit their highest level in nearly seven months. Crude for July delivery rose US$2.27, or 3.4%, to end at US$68.58 a barrel on the New York Mercantile Exchange.

Shares of Suncor Energy Inc. gained 4.6% to $40.00 and Canadian Natural Resources Ltd. jumped $3.45, or 5.3%, to close at $68.16.

Also higher was EnCana Corp., up 4.8% to $62.85, and Imperial Oil Ltd., up 4.3% to $46.27.

Financial stocks also advanced on Monday, gaining 2.3%.

Shares of Manulife Financial Corp. gained 3.2% to $24.25 and Royal Bank of Canada rose 2.2% to $44.66.

Sun Life Financial Inc. added 4% to $29.85 and Bank of Nova Scotia rose 2.8% to $39.23.

Meanwhile, materials stocks retreated on Monday, slipping 0.4% as gold futures dipped. Gold for August delivery fell US$0.30 cents to finish at US$980 an ounce on the Comex division of the New York Mercantile Exchange.

Shares of Goldcorp Inc., tumbled 5.1% to $40.95 after the company said it will sell about US$750 million of convertible senior notes due in 2014 to repay a revolving credit facility and fund capital spending.

Barrick Gold Corp. fell 2.3% to $40.41 and Iamgold Corp. slipped 2.8% to $11.94.

Higher for the day was Teck Resources Ltd., up 8.8% to $18.65, and First Quantum Minerals Ltd., up 5.2% to $51.17.

The S&P/TSX Venture composite index gained 16.47 points, or 1.5%, to close at 1,140.55.

The Canadian dollar edged up US0.06¢ to close at US91.66¢.

In New York, U.S. markets also advanced as investors reacted to new economic data. The Commerce Department reported that consumer spending fell by a smaller than expected 0.1% in April, while manufacturing in the U.S. shrank less than forecast in May as new orders increased for the first time since the recession began, according to the Institute for Supply Management’s factory index.

The Dow Jones industrial average ended at 8,721.44, up a sharp 221.11 points, or 2.6%.

The S&P 500 index added 23.73 points, or 2.6%, to close at 942.87.

The Nasdaq composite index gained 54.35 points, or 3.1%, to finish at 1,828.68.

IE