The Canadian Press

The Toronto stock market closed higher Tuesday but the rise was mainly due to gold surging to a record high close, railway stocks that benefited from major acquisition activity south of the border and higher oil prices.

It was a volatile session on the S&P/TSX composite index, which had been down as much as 124 points in early trading but finished the day 147.55 points higher at 11,025.9.

The showing helped the TSX claw back some of the loss of more than 5% from the previous seven sessions as investors worry about whether economic conditions can support the sharp gains racked up since March.

“The bar is being raised on what constitutes good news,’’ said Avery Shenfeld, chief economist at CIBC World Markets.

“Three or four months ago, not bad news was good enough to lift the stock market and I think now, at current levels, the market is more demanding in terms of what it wants to see, both on corporate results and particularly on economic data,’’ Shenfeld said.

The Canadian dollar closed up 0.84 of a cent at US93.62¢.

The gold sector was ahead 6.43% as the December bullion contract on the New York Mercantile Exchange gained $30.90 to US$1,084.90 an ounce. The surge came as the International Monetary Fund said it sold 200 metric tons of gold to the Reserve Bank of India. Goldcorp Inc. (TSX:G) gained $2.82 to $42.96 while Barrick Gold Corp. (TSX:ABX) was up $2.58 to $41.97.

The TSX industrial sector was ahead almost 2% after Warren Buffet’s Berkshire Hathaway said it was buying Burlington Northern Santa Fe in a deal valuing the railway at US$34 billion.

Berkshire Hathaway Inc. already owns a stake of about 22% in Burlington Northern, and says it will pay $100 a share for the rest of the company. That is a 32% premium over Burlington’s closing price Monday.

The deal sent Canadian railway stocks higher with Canadian National Railway (TSX:CNR) ahead 93¢ to $53.50 while Canadian Pacific Railway (TSX:CP) advanced $1.53 to $48.75. Other transport companies were lifted, including Bombardier Inc., (TSX:BBD.B) ahead 23¢ to $4.58.

The energy sector was up 0.42% as oil prices reversed early losses. The December crude contract on the New York Mercantile Exchange moved up $1.47 to US$79.60 a barrel.

On the TSX, Nexen Inc. (TSX:NXY) rose 25¢ to $23.76 while Suncor Inc. (TSX:SU) declined 63¢ to $34.96.

The base metals sector also contributed to the day’s gains, up 1.6% as the December copper contract on the Nymex advanced 1.1¢ to US$2.956 a pound. HudBay Minerals (TSX:HBM) gained 80¢ to $14.42.

The TSX Venture Exchange was ahead 37.13 points to 1,326.75.

New York indexes were mixed amid uncertainty about a raft of key economic developments later this week, which culminates in Friday’s closely watched U.S. non-farm payrolls report for October. Statistics Canada also releases October employment data Friday.

And ahead of those announcements, the U.S. Federal Reserve is holding its scheduled meeting on interest rates and will issue a statement on rates and the economy Wednesday afternoon.

But investors were relieved at a Commerce Department report that orders to U.S. factories rose 0.9%, slightly better than the 0.8% advance economists expected.

The Dow Jones industrial average declined 17.53 points to 9,771.91.

The Nasdaq composite index moved 8.12 points higher to 2,057.32 while the S&P 500 index gained 2.53 points to 1,045.41.

Elsewhere on the markets, a day after reporting a solid quarterly profit, Ford Motor Co. said strong demand for cars and crossovers lifted its U.S. sales by 3% in October compared with a year ago.

Ford said it sold 118,735 vehicles in October, up 21% compared with September when auto sales plunged with the end of the U.S. Cash for Clunker program in August. However, Ford shares dipped 14¢ to US$7.44 after running up 8.3% Monday when the automaker issued a strong quarterly profit of just under US$1 billion.

Chrysler Group LLC says its October sales fell 30% below the same month last year but that sales were up 6% from September.

On the Canadian earnings front, Talisman Energy Inc. (TSX:TLM) saw its profits plunge in the third quarter as falling commodity prices and lower production output took their toll on earnings. The company reported net income of $30 million or 3¢ a share, a significant drop from a year-ago profit of $1.4 billion or $1.40 per share. Talisman’s revenue was $1.5 billion, down from $2.7 billion in the same period last year and its shares were unchanged at $18.33.

@page_break@Increased gold production, combined with higher metal prices, helped Northgate Minerals Corp. (TSX:NGX) narrow its losses in the third quarter as revenues rose. Northgate posted a net loss of $8.6 million, an improvement from a year-ago net loss of $29.4 million. Quarterly revenues totalled $120.2 million, up from $99.3 million a year ago and Northgate shares gained 15¢ to $2.94.

Groupe Aeroplan Inc. (TSX:AER), the loyalty program company spun off from Air Canada (TSX:ACE), is expanding its international business with the $188-million purchase of Carlson Marketing, a U.S.-based customer-loyalty company that also has a presence in Europe, Asia and the Middle East. Its shares were off 4¢ at $8.86.