TORONTO -- North American stock markets partially rebounded from Wednesday's correction on a broad-based rally even though crude oil prices hit their lowest level in about five months.

The climb started in the morning after European Central Bank president Christine Lagarde said the financial institution has unanimously agreed to add stimulus measures to address the impact of rising COVID-19 infections, said Erik Bregar, head of currency strategy at the Exchange Bank of Canada.

"She teed it up quite clearly that more stimulus is going to be coming in Europe in December and everything moved up since then," he said in an interview.

Risk currencies and European bonds responded, suggesting that more quantitative easing or a deposit rate cut could be coming in December, Bregar noted.

"When you see global markets grasp onto something positive, it just lifts everything," he said. referring to the reaction in North America.

The energy sector fell on the TSX as crude oil futures dipped below US$37 a barrel to its lowest closing price since early June. Crescent Point Energy Corp. led with a drop of 5.7 per cent.

The December crude contract was down US$1.22 at US$36.17 per barrel and the December natural gas contract was up one cent at US$3.30 per mmBTU.

The S&P/TSX composite index closed up 84.13 points to 15,670.70. That's a day after it lost 434 points or 2.7 per cent on concerns about growing virus infections.

In New York, the Dow Jones industrial average was up 139.16 points at 26,659.11, a day after losing 943 points. The S&P 500 index was up 39.08 points at 3,310.11, while the Nasdaq composite was up 180.72 points at 11,185.59.

Bregar said he doesn't think fiscal stimulus negotiations in the U.S. have evolved into anything to drive the rebound and he questions whether the U.S. Federal Reserve will follow the ECB and offer additional help unless pushed to do so.

"I don't think the Fed knows what to do," he said. "My bet would be it does something when the market forces their hand."

Thursday's market movement came after record third-quarter U.S. GDP and improved weekly jobless numbers.

The world's largest economy grew at an astronomical annual rate of 33.1% from July through September, after shrinking by 31.4 per cent in the second quarter. However, economic growth hasn't fully recovered from the pandemic.

"It's a fun headline: GDP up 33 per cent. But it doesn't mean much to the markets, in my opinion at least," he said, adding the number and jobless numbers are not surprising.

The number of U.S. workers applying for unemployment benefits fell to 751,000 from 791,000 a week earlier, but continuing claims remained very high.

Eight of the 11 major sectors of the TSX were higher, including materials and financials.

Materials gained 1.5 per cent with shares of Alamos Gold Inc. surging 12.5 per cent despite lower gold prices.

The December gold contract was down US$11.20 at US$1,868.00 an ounce and the December copper contract was down 0.75 of a cent at nearly US$3.06 a pound.

The heavyweight financials sector rose 1.3 per cent with Manulife Financial Corp. up 2.1 per cent and the Royal Bank of Canada 1.9 per cent higher.

A five-per-cent drop by Shopify Inc. pushed technology lower.

The Canadian dollar traded for 74.91 cents US compared with 75.18 cents US on Wednesday.

More risk-off global activity could send the loonie on a new down trend, falling to about 73 cents, Bregar said.

"Any sort of big selloff in stocks or a continued move lower could take the Canadian dollar with it."

This report by The Canadian Press was first published Oct. 29, 2020.