The Canadian Press

The Toronto stock market posted a modest gain Monday as further weakness in the U.S. dollar boosted commodity prices.

The S&P/TSX composite index rose 33.63 points to 11,538.39 as the main index also received support from the financial sector. National Bank climbed 88¢ to $59.58.

The TSX Venture Exchange was up 7.2 points to 1,338.77.

Potash Corp. (TSX:POT) was also a source of lift on the TSX, rising $5.72 or 5.66% to $106.84 after Bank of America Merrill Lynch said that BHP Billiton, the world’s biggest mining company, could boost earnings and cut excess cash by purchasing the Canadian fertilizer giant at a 30% premium to the share price.

“This is just part of what you always see at a time when demand is strong or companies are trying to position themselves well for future growth,” said Kate Warne, Canadian markets specialist at Edward Jones in St. Louis.

“It’s not too surprising that you might see a variety of companies thinking that being in, not just industrial metals and precious metals, but in agricultural commodities as well, would be a logical thing to do.”

The base metals sector rose 0.33% amid reassurances from a top Chinese economic official that his country’s economic growth is on track. Xiong Bilin, a deputy director of the National Development and Reform Commission, said the country would surpass its growth target of 8% this year. Equinox Minerals (TSX:EQN) climbed 13¢ to C$4.06.

“As long as people believe that China is continuing to grow at that kind of pace, it will lead to expectations of stronger resource usage in the future,” added Warne.

The December copper contract on the New York Mercantile Exchange gained 12.1¢ to US$2.97 a pound.

Shares in silicon processor Timminco Ltd. (TSX:TIM) surged 93¢ or 53.76% to $2.66. Its stock has been on a tear since Friday when it announced it was restarting the third of three electric arc furnaces. Chief financial officer Robert Dietrich said that while demand for solar-grade silicon remains depressed, Timminco is experiencing a return in orders from traditional customers for silicon metal.

China’s Sichuan Hanlong Group has agreed to arrange up to $518 million in debt funding and to purchase a $145.1 million stake in Moly Mines Ltd. (TSX:MOL), which is developing the Spinifex Ridge molybdenum and copper project in Australia. Moly shares jumped 24¢ or 19.83% to $1.45 on the TSX.

The energy sector was up 0.19% Monday as the November crude contract on the New York Mercantile Exchange rose $1.08 to US$79.61 a barrel. Oil has risen sharply following a report last Thursday which showed an unexpected drawdown of gasoline inventories, pushing crude prices to their highest levels in a year. But EnCana Corp. (TSX:ECA) gave back 61¢ to $64.34.

The TSX tech sector was the leading TSX decliner, down 0.64% with CGI Group (TSX:GIB.A) down 29¢ to $13.37.

The gold sector also lost ground even as the December bullion contract climbed US$6.60 to US$1,058.10 an ounce.

A day before the Bank of Canada makes its next announcement on interest rates, weakness in the greenback sent the Canadian dollar up 0.73 cents to US97.15¢. The central bank is expected to leave its key rate unchanged at 0.25%.

New York markets were up sharply after a handful of earnings reports revived hopes that the economy is improving.

Industrial equipment maker Eaton Corp. said it was seeing improvement in key markets and raised its full-year profit forecast. Newspaper publisher Gannett Co. managed to post a profit despite a sharp fall in revenue, and Hasbro Inc.’s income rose on cost cuts.

However, the toymaker missed on revenue and its shares fell US$1.16 to US$28.36.

The Dow Jones industrial average rose 96.28 points to 10,092.19.

The Nasdaq composite index moved 19.52 points higher to 2,176.32 ahead of earnings being released later in the day by Apple Inc. and Texas Instruments Inc., while the S&P 500 index was up 10.23 points to 1,097.91.

Burt White, chief investment officer at LPL Financial in Boston, noted that three of every four U.S. companies so far has topped analysts’ expectations for earnings in the July-September quarter. White says that’s a sign that the economy is doing better than most investors had predicted.

“The recovery is moving faster than analysts can sharpen their pencils and revise their estimates upward,” he said.

In other corporate news, fertilizer company Agrium Inc. (TSX:AGU) is to sell half of its Carseland nitrogen facility to U.S.-based Terra Industries Inc. for US$250 million. The deal is conditional on the closing of Agrium’s proposed takeover of U.S. CF Industries Holdings Inc. Agrium shares rose $3.55 to $58.90.

@page_break@Toromont Industries Ltd. (TSX:TIH) made a cash-and-stock bid Friday for Enerflex Systems Income Fund (TSX:EFX.UN) that valued the income trust at about $597 million. Under the offer announced after the close of markets Friday, Toromont offered $13.50 per unit for Enerflex with at least half of the offer to be made in cash. Toromont shares rose $1 to $24.60 while Enerflex units soared $4.05 or 40.2% to $14.12.

A joint venture headed by Manulife Financial Corp. (TSX:MFC) has received approval from China’s insurance regulator to operate in Shantou, a port city with a population of more than five million people. Its shares added 42¢ to $22.44.