Canada’s main stock index hit a fresh 2016 high on Thursday as energy stocks gained despite a slip in oil prices and financial and mining shares also rose.

The rally gained momentum after weeks of worry about the state of the global economy, and that prompted one Bay Street economist to declare on Thursday those fears were way overdone.

“We’ve been steadily downgrading our Canadian and global growth outlook since the second half of 2014,” CIBC Capital Markets chief economist Avery Shenfeld wrote in a note to clients. “But we now find that market chatter has left us feeling like rose-glassed optimists.”

Shenfeld pointed out that fears about the global economy have taken hold on trading floors, but those worries don’t align with actual economic forecasts. He cautioned that the U.S. Federal Reserve isn’t destined to push rates into negative territory, and he also said monetary policy in Canada isn’t going to “turn Japanese”, in reference to the Bank of Japan’s prolonged period of negative rates.

“Take a chill pill,” Shenfeld wrote, “as things aren’t as bad as you’re hearing on the street.”

Canada’s main stock index pushed above 13,000 for the first time this year on Wednesday as investors shook off worries about global growth amid upbeat data from major economies and signs of a rebound in commodity prices.

Among the most influential gainers was Canadian Natural Resources Ltd, which advanced 9 per cent to $32.87, even as it cut its 2016 capital expenditure and reported a sharp fall in profit.

“Take a chill pill,” Shenfeld wrote, “as things aren’t as bad as you’re hearing on the street.”

With its second straight day of increases, the stock reached its highest since early December.

The energy group climbed 2.9 per cent, though oil prices dipped after ballooning U.S. crude inventories and lack of progress on talk to control supply overshadowed the bullish sentiment that has built up this week.

At around 4 p.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 105.72 points, or 0.8 per cent, at 13,123.02..

Eight of its 10 main groups were positive, with advancers outnumbering decliners by more than three to one.

The financials group gained 0.6 per cent, while materials, which includes precious and base metals miners and fertilizer companies, added 2.8 per cent.

Goldcorp Inc rose 4.7 per cent to $20.22, and Bank of Nova Scotia advanced 1 per cent to $58.35.

SNC-Lavalin Group Inc was up 2.2 per cent to $45.03 after posting a better-than-expected adjusted fourth-quarter profit and said it saw profit growth at its core engineering and construction business in 2016.

Industrials rose 0.5 per cent.

On the negative side, Valeant Pharmaceuticals International Inc fell 2 per cent to $88.94 after the embattled drugmaker said a senior executive had resigned, not been asked to leave.

U.S. stocks were slightly lower in late morning trading on Thursday as investors parsed a barrage of economic data and awaited the monthly jobs report.

Earlier in the day, data showed weekly jobless claims rose unexpectedly, but the underlying trend continued to point to a strengthening labour market.

The data comes ahead of the comprehensive labour report for February on Friday. The report is expected to show an addition of 190,000 jobs, compared with 151,000 in January.

While concerns linger over the state of the global economy, upbeat data from major economies this week and signs of a rebound in commodity prices have helped ease some of those worries.

Brent crude rose 0.7 per cent to $37.20 and is up about 35 per cent from last month’s lows. U.S. crude was up 1.1 per cent at $35.03.

The ISM non-manufacturing PMI index slowed to 53.4 in February from 53.5 the month before, but came in above expectations of 53.2.

“We’ve had a pretty nice run off late because of oil prices steadying and positive macro economic data,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.

“Investors are in a wait-and-see mode ahead of the jobs report tomorrow and there is some profit taking too.”

Wall Street closed higher on Thursday, with the S&P 500 at its highest in two months, adding momentum to a recent recovery as energy companies and banks made gains.

The Dow Jones industrial average rose 44.24 points, or 0.26 percent, to 16,943.56, the S&P 500 added 6.94 points, or 0.35 percent, to 1,993.39 and the Nasdaq Composite gained 4 points, or 0.09 percent, to 4,707.42.

Five of the 10 major S&P 500 sectors were lower, with the health index’s 0.83-per-cent fall leading the decliners.

Solid economic data could bolster expectations that the Federal Reserve remains on track to raise interest rates this year. Fed funds futures suggested traders are pricing in a 61 percent chance of a rate hike by year-end. The central bank meets next on March 15-16.

“The likelihood of the Fed raising in March is very low,” said Jeff Powell, managing partner of Polaris Greystone Financial Group in California.

Powell said a weak jobs report might spook the market but the general trend is positive.

As of Wednesday’s close, the S&P 500 index is down only 2.8 per cent, recouping from a fall of over 10 per cent earlier this year.

Shares of Herbalife were down 6.9 per cent at $52.50 after the company said it had overstated growth in the number of new members in some instances due to a database error.

Kroger was down 7.5 per cent at $37.57 after the largest U.S. supermarket operator’s quarterly sales missed estimates.

- With files from BNN