Toronto stocks rallied Friday, as a spike in the price of oil, caused by supply concerns and global uncertainty, spurred the energy sector. The S&P/TSX composite index finished up 110.81 points, or 1.07%, at 10,502.11.

Volume on the senior exchange was a light 170 million shares.

Eight of 10 TSX main sub-groups ended up, with the energy sector posting a 2.31% gain.

Crude for September delivery closed at US$65.35, up $2.08 for the session, after hitting a high of US$65.50 a barrel in intra-day trading on the New York Mercantile Exchange.

Markets were unsettled after local unrest at refineries in Ecuador and Nigeria and a report of a rocket fired at a U.S. Navy ship docked in a Jordanian port.

Canadian Natural advanced $1.98, or 3.84%, to $53.48, Nexen Inc. gained $1.58, to $55.00.

The information technology group rose 1.72%.

Nortel Networks gained 7¢, or 1.84%, to $3.87.

TUI AG, a German transport and travel conglomerate, says it has been talks with CP Ships about a possible acquisition. The Wall Street Journal says TUI may bid $1.8 billion US for the London-based ocean transport company. CP Ships shares gained 36¢, or 1.55%, to $23.60.

December gold futures closed down $2.50 at US$442.20. Nevertheless, the gold sector stayed flat.

The junior S&P/TSX Venture composite index finished up 18.41 points, or 0.97%, to 1,909.73.

In New York, investor reaction about a verdict against pharmaceutical giant Merck & Co. sunk gains earlier in the day’s trading.

The Dow Jones industrial average rose 4.30, or 0.04%, to close at 10,559.23. The S&P 500 i gained 0.69, or 0.1%, to 1,219.71, while the Nasdaq composite index slipped 0.52, or 0.02%, to 2,135.56.

A Texas court found Merck & Co. liable for the death of a man who took Vioxx, and awarded his estate more than US$250 million in damages. More than 4,000 Vioxx lawsuit cases have been filed against the company. Merck shares dropped $2.35, or 7.7%, to US$28.06

Retailer Gap Inc. fell 2.03%, to US$19.74 after Merrill Lynch cut the retailer to neutral from buy, citing disappointing August sales.

For the week, the Dow slipped 0.4%, the S&P 0.9%, and the Nasdaq 1%.