TORONTO (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Tuesday, recovering from an earlier eight-day low, as corporate earnings results bolstered Wall Street, offsetting uncertainty about the speed and size of U.S. stimulus.
The loonie was trading 0.3% higher at 1.2699 to the greenback, or 78.75 U.S. cents, having touched its weakest since Jan. 18 at 1.2782.
The S&P 500 notched a record high, helped by positive earnings updates from a slew of companies including General Electric (NYSE:GE) and Johnson & Johnson (NYSE:JNJ), while the Federal Reserve kicked off its two-day policy meeting.
U.S. Senate Majority Leader Chuck Schumer said Democrats may try to pass much of President Joe Biden's $1.9 trillion spending package with a majority vote, but it is not clear if they have the numbers to override Republican objections.
Canada sends about 75% of its exports to the United States, including oil. U.S. crude prices were up 0.4% at $53.00 a barrel alongside rising global shares and amid reports of a blast in Saudi Arabia, trading near 11-month highs.
Canadian government bond yields were higher across the curve in tandem with U.S. Treasuries. The 10-year rose 1.1 basis points to 0.824%.
Canada's GDP data for November is due on Friday which could offer some clues on the interest rate outlook.