Source: The Canadian Press

The Toronto stock market appeared poised for a higher open Monday, driven by rising commodities, as markets enter a week of low volume trading and many investors take a Christmas holiday.

The Canadian dollar moved up 0.03 of a cent to 96.77 cents US.

The January crude contract was 62 cents higher at US$88.64 a barrel on the New York Mercantile Exchange.

The February gold contract gained $5 to US$1,384.20 while the March copper contract on the Nymex added four cents at US$4.20.

U.S. markets were also poised to move higher. The Dow futures were up 30 points at 11,460 and Nasdaq futures gained 10.25 points to 2,223.50. The S&P 500 futures were up 5.3 points to 1243.7.

Many traders are taking the next two weeks off amid the year-end holidays.

On the TSX, Talisman Energy Inc. (TSX:TLM) has paired with South African energy and mining giant Sasol Ltd. in a $1.05-billion development agreement for its Farrell Creek gas field.

Duluth Metals Ltd. (TSX:DM) has agreed to pay $77 million to acquire Franconia Minerals Corp. (TSX:FRA), which explores properties in northeastern Minnesota.

ArcelorMittal has signed a deal to increase its friendly takeover offer for Baffinland Iron Mines Corp (TSX:BIM) to $1.25 per share, up from an offer of $1.10. The increased offer, worth about $492 million, comes in the face of a hostile offer by Nunavut Iron Ore Acquisition Inc., a subsidiary of the private equity investor Energy & Minerals Group, of $1.35 per share.

The main TSX index finished lower last week as fresh worries about sovereign debt punished commodities because of concern about demand. Prices for oil and metals also moved lower as nervous investors moved to the safe haven status of the U.S. dollar.

A stronger U.S. dollar makes commodities like oil, which are priced in greenbacks, less appealing to buyers who use foreign currencies.

Statistics Canada releases its November reading on the Consumer Price Index on Tuesday and it could provide an indication on what the Bank of Canada will do about interest rates in 2011.

World stock markets were mixed Monday as investors watched with unease as South Korea went ahead with a military drill on a frontline island despite threats of North Korean retaliation.

The approval of a U.S. plan to extend tax cuts and unemployment benefits offered some support to markets in Europe and the U.S.

In Europe, the FTSE 100 index was up 0.5%, while Germany’s DAX gained 0.95%, and France’s CAC-40 moved 1.07% higher.