The Toronto stock market was higher Tuesday as data pointing to strong German investor optimism eased fears that Europe’s biggest economy could be headed into recession.There was also some major acquisition news in the financial sector. Canada’s Great West Lifeco (TSX:GWO) is buying Irish Life Group for $1.75 billion. Its shares were earlier halted on the TSX but by late morning were down 24 cents to $26.54.The S&P/TSX composite index gained 78.14 points to 12,764.77 while the TSX Venture Exchange dipped 10.82 points to 1,174.83.The Canadian dollar fell 0.65 of a cent to a seven-month low of 98.74 cents US.U.S. indexes were also positive after Germany’s ZEW institute index rose to 48.2 points from 31.5 in January. It was the third monthly increase in a row and above the 36 points expected by market analysts.The Dow Jones industrial average rose 40.43 points to 14,022.19, the Nasdaq composite index was up 8.07 points at 3,200.1 and the S&P 500 index climbed 5.75 points to 1,525.54.The data came as a relief after another economic report last week showed Germany’s economy shrank 0.6 per cent in the fourth quarter. A drop in the first quarter of this year would put it in a technical recession but many economists think the dip was only temporary and that the economy will quickly return to growth.“The slide in German activity has been concerning in recent months so to get the data we got today suggests that there might be some stabilization going on in some of the more bellwether economies there as well,” said Craig Fehr, Canadian markets specialist at Edward Jones in St. Louis.However, the optimism was tempered somewhat by worries about the looming sequester in the U.S. That is a huge package of across the board spending cuts worth US$85 billion that are set to take effect at the end of the month unless lawmakers can agree on other cuts that would be more selective.It would cut a big chunk out of American economic growth, a worrisome prospect for a struggling economy.“If it goes into place, which I think is a reasonable potential, you’re looking at about eight-tenths of a per cent drag on the economy this year,” added Fehr. “That’s meaningful when you’re talking about an economy only growing at two per cent (but) the important thing is we’re not talking about a tipping point back into recession.”Last Thursday, JPMorgan Chase cut its forecast for U.S. growth in 2013 to 1.9 per cent from 2.1 per cent, citing the rising odds that the spending reductions will actually take place.Telecoms led TSX gainers, up 1.45 per cent with Rogers Communications (TSX:RCI.B) continuing to benefit from a strong earnings report Friday, up $1.34 at $48.66.The financial sector ran ahead 0.8 per cent as Royal Bank (TSX:RY) advanced $1.06 to $64.36.The information technology sector was ahead 0.75 per cent as BlackBerry (TSX:BB) gained 46 cents to $14.69 even as Canaccord Genuity slashed its estimate of BlackBerry BB10 smartphone shipments in February to just 300,000 units, a far cry from its earlier estimate of more than 1.75 million.The equities research unit of Canaccord Financial Inc. (TSX:CF) says its global surveys show initial sales have been mixed for the BlackBerry Z10, with limited supply rather than overwhelming demand behind post-launch shortages at some stores. Elsewhere in the sector, Constellation Software (TSX:CSU) was down $1.87 to $118.13.Prices weakened for oil and copper despite the positive European data.The energy sector was up 0.62 per cent as the March crude contract on the New York Mercantile Exchange dipped 24 cents to US$95.62 a barrel. Suncor Energy (TSX:SU) was ahead 23 cents to C$31.98.The mining sector lost 0.75 per cent while copper prices fell sharply after several local governments in China announced new measures to restrict financing to potential homebuyers. That triggered concerns about a fresh wave of tightening for the property sector.March copper ticked eight cents lower to US$3.66 a pound. China is the biggest consumer of copper, considered an economic bellwether as it is used in so many industries, including electrical and plumbing in houses. HudBay Minerals (TSX:HBM) was off 16 cents to C$10.78.Inmet Mining Corp. will waive application of a shareholder rights plan that was supposed to take effect hours before the Feb. 27 deadline for First Quantum’s (TSX:FM) hostile $5.1-billion takeover bid. Inmet (TSX:IMN) said Tuesday that its board is taking the action because it has enough time to review and execute all strategic alternatives being considered. Inmet shares lost 93 cents to $69.54 while First Quantum shares was unchanged at $20.02.The gold sector was down 0.65 per cent while April bullion was off $5.50 to US$1,604 an ounce. Iamgold Corp. (TSX:IMG) advanced 15 cents to C$8.11.In other corporate developments, Google’s stock price topped US$800 for the first time Monday amid renewed confidence in the company’s ability to reap steadily higher profits from its dominance of Internet search and prominence in the increasingly important mobile device market.The milestone comes more than five years after Google’s shares initially barrelled through $700. At mid-morning, Google stock was slightly off the highs of the morning but still up $8.82 to $801.71.European bourses advanced following the release of the German investment confidence data, with London’s FTSE 100 up 0.86 per cent, Frankfurt’s DAX gaining 1.59 per cent and the Paris CAC 40 moving ahead 1.87 per cent.