TORONTO - The Toronto stock market ended Wednesday in positive territory, posting a small gain as oil prices and the base metals sector provided lift for the second day in a row.

The S&P/TSX composite index inched up 28.83 points to end the day at 11,046.93, a day after a 230-point surge saw it climb to close above 11,000 points for the first time in 10 months.

However, investors appear wary of taking the market too high too quickly and analysts were expecting stocks to drift after such a big move.

Andrew Pyle, an investment adviser with ScotiaMcLeod in Peterborough, Ont., said a combination of profit-taking and negative reaction to some disappointing economic data out of the U.S. is keeping markets flat.

"Now that we're really pushing the edge of that envelope, there's that feeling that at some point the market has to have what they call a 'healthy correction,' just simply to convince everyone that yes, the bottom was experienced months ago, this rally can continue, but it can't continue in a one-way direction," Pyle said.

"It has to backfill at some point."

Pyle said second-quarter earnings have mostly exceeded investors' expectations to date, but they have been driven by cuts to inventory and costs rather than improved performance.

"At some point you have to see real evidence that the economy's turning and that companies are starting to see revenue stabilize and improve, and we haven't seen that yet, so that would be the basis for some profit-taking activity," he said.

The price of oil also turned positive in afternoon trading, adding 55 cents to US$71.97 a barrel for the September contract on the New York Mercantile Exchange. Toronto's energy sector was down 0.6 per cent.

The base metals sector led the way to Wednesday's gain, adding 1.8 per cent on investor optimism about the economy, growing demand in China and a weaker U.S. dollar.

The loonie, which has soared ever closer to parity in recent weeks as commodity prices have strengthened, added 0.38 cent to 93.45 cents US.

The gold sector fell 0.6 per cent as the December bullion contract on the Nymex lost $3.40 to US$966.30 an ounce.

The TSX Venture Exchange lost 0.99 points to 1,194.99.

In New York, markets were lower after a trade group said its measure of the health of the U.S. services sector contracted more sharply than expected in July.

The Institute for Supply Management's services index clocked in at 46.4, down from 47 in June. It's the 10th straight month of decline, as any reading below 50 indicates the sector is shrinking. Analysts had expected a reading of 48.

The Nasdaq composite index slipped 18.26 points to 1,993.05 while the Dow Jones industrial average lost 39.22 points to 9,280.97.

The S&P 500 fell 2.93 points to 1,002.72.

In other economic news, U.S. factory orders made a surprise 0.4 per cent increase in June, much better than the expected 0.8 per cent dip.

In Canadian corporate news, Lakeside Steel Inc. (TSXV:LS) is pushing a bid to bring former Hamilton steelmaker Stelco back to life and put the company now owned by United States Steel Corp. (NYSE:X) back into Canadian hands.

Lakeside said it has filed for intervenor status in Federal Court hearings into alleged breaches by U.S. Steel of job and production commitments it made two years ago in getting government approval for its $1-billion takeover of Stelco.

The news sent Lakeside's stock soaring 4.5 cents or 29 per cent to 20 cents.

Fertilizer giant Agrium Inc. (TSX:AGU) reported second-quarter net income of US$370 million, down 42 per cent from a year earlier. The results beat analysts' expectations and helped push its shares $1.49 or 2.9 per cent higher to $52.17.

And news that steel distributor Russel Metals Inc. (TSX:RUS) lost $24.6 million in its second quarter as revenue was nearly cut in half sent its stock falling by 31 cents to $16.27.