TORONTO - North American stock markets rebounded strongly to close the trading week, with the Toronto stock market posting a triple-digit gain in advance of the Victoria Day holiday weekend.

The Toronto Stock Exchange's S&P/TSX composite index soared 102.26 points to close at 13,919.58 on Friday.

In New York, markets turned higher after big drops Thursday as traders appeared to come to terms with the renewed possibly of a June rate hike.

The Dow Jones industrial average was up 65.54 points at 17,500.94, the broader S&P 500 composite index advanced 12.28 points to 2,052.32 and the Nasdaq composite rose 57.03 points to 4,769.56.

For the past couple of days, the markets have been driven by reaction to minutes from the April meeting of the Federal Reserve which showed a possible interest rate hike in mid-June is back on the table, said Philip Petursson, chief investment strategist at Manulife Investments.

All four indexes posted losses Thursday in reaction to the Fed news, which appeared to catch traders by surprise.

"I think this is maybe just a bit of a rebound from the past couple of days that have been a little bit more negative in reaction to the Fed meeting minutes," Petursson said.

He thinks it's more likely the Fed will raise rates when it meets in late July, considering how close the June 14-15 meeting is to the United Kingdom's June 23 referendum on whether it should leave the European Union.

But there's still an outside chance the next hike could come in June, he said.

Despite the market rebound, the Canadian dollar posted its fourth consecutive loss, down 0.11 of a U.S. cent at 76.20 cents US.

The loonie is facing headwinds from a resurgent U.S. dollar following the news from the Fed on interest rates. However, that's unlikely to keep dragging the commodity-sensitive loonie down, said Petursson.

While the July crude contract was down 26 cents at US$48.41 a barrel on Friday, Petursson said the long-term outlook is more positive. A conservative estimate for the price of oil is US$55 a barrel at some point this year, he said, and that should move the loonie higher too.

"If this is a tug of war between oil prices and the Fed, I think oil prices are going to win and ultimately we'll see the Canadian dollar higher through the rest of the year," he said.

Elsewhere in commodities, June natural gas was up 2.3 cents at US$2.06 per mmBtu, the June gold contract fell $1.90 to US$1,252.90 a troy ounce and July copper was little changed at US$2.06 pound.

New York markets will reopen as usual on Monday, but Toronto remains closed for Victoria Day.

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News from © The Canadian Press, 2016