By Linda Nguyen, The Canadian Press

Toronto: The trading week started Monday with a bang, as the Canadian dollar soared to its highest level in half a year on the back of rising crude and gold prices.

The oil-fuelled loonie, which was higher for a second straight day, rose 0.62 of a U.S. cent to settle at 77.53 cents US. The last time the Canadian dollar closed above that level was on Oct. 15, 2015, when it was 77.84 cents US.

“(It’s a) pretty big move in the Canadian dollar,” said Roland Chalupka, chief investment officer at Fiduciary Trust Canada.

“Gold and oil are up for the day and that’s generally good for the Canadian dollar and for international investors as they look at Canada.”

Positive sentiment arose from hopes that a meeting of OPEC nations later this week will spell out a deal to freeze oil production.

The May contract for benchmark North American crude climbed 64 cents at US$40.36 a barrel _ the first time oil prices have closed above US$40 a barrel in three weeks.

Expectations are high that the Sunday meeting of members from OPEC in Qatar will result in a deal that will slow down production going to market and help bolster prices. Crude prices have fallen from a high of more than $100 a barrel in 2014.

Investors also flocked to the safe haven of gold, cheered by the latest economic data coming out of China, the world’s second-largest economy.

China reported that its inflation rate in March was 2.3 per cent, unchanged from February. The weak data helped spur expectations that the Chinese may step in with more monetary stimulus to help the economy from slowing down further.

June gold rose $14.20 to US$1,258 a troy ounce. Elsewhere in commodities, May natural gas was down eight cents at US$1.91 per mmBtu, while May copper was unchanged at US$2.09 a pound.

In equity markets, Toronto and New York indices had been higher for most of the day, but began trading sideways near the closing bell.

Toronto’s S&P/TSX composite index was ahead 26.03 points at 13,422.76, building on Friday’s 130-point gain.

In New York, markets turned lower with the Dow Jones industrial average losing 20.55 points at 17,556.41, the S&P 500 dipped 5.61 points to 2,041.99 and the Nasdaq composite retracted 17.29 points to 4,833.40.

Chalupka said stock markets are generally enjoying a recovery from February’s lows, but investors should still exercise caution because it’s unclear how long the trajectory can last over the long term.

“At this point, they’re not back up to their old highs. If you look at recent highs, it’s an improvement but it’s an improvement off of a very weak start to the year,” he said.

“We would say to investors, ‘You might want to make sure things really are improving before you commit new money at this point in the cycle. It is important to look at the longer term direction, not just the shorter term.”’

In corporate news, Canadian Pacific Railway (TSX:CP) said Monday it has abandoned its proposal to merge with Norfolk Southern Corp., days after facing stiff opposition from the U.S. Departments of Justice and Defense. The deal would have created the largest railroad in North America.

Shares in Calgary-based Canadian Pacific rallied $4.60 or more than two per cent at $179.91.