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TORONTO (Reuters) - Canada's main stock index edged up to a one-week high on Tuesday as better-than-expected earnings for Bank of Montreal supported bank stocks, offsetting losses for the materials group.
Bank of Montreal (BMO.TO) rose 2.2 percent to C$86.27. Canada's fourth largest bank reported quarterly results which beat analysts' expectations, benefiting from strength in its commercial banking and capital markets businesses.
BMO's earnings made the market optimistic about the earnings of other banks that are due to report, said Paul Hand, managing director at RBC Capital Markets.
Gains for bank stocks helped drive the financials group 0.8 percent higher, while the energy group firmed 0.1 percent as oil rallied.
U.S. crude oil futures CLc1 settled up 69 cents at $48.10 a barrel after Reuters reported that Iran was sending positive signals that it may support joint OPEC action to prop up the market. [O/R]
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed up 16.58 points, or 0.11 percent, at 14,764.77. It touched its highest since Aug. 15 at 14,796.56.
If Canada's other major banks can also beat expectations and if oil can remain in the "high ($)40s," then the market can set new highs for the year, Hand said.
"The longer-term trend sure feels like it's up at the moment," he added.
Just four of the index's 10 main groups ended higher.
Fertilizer producer Potash Corporation of Saskatchewan Inc. (POT.TO) rose 2.7 percent to C$21.63.
Still, the materials group, which includes precious and base metals miners as well as fertilizer companies, fell 1.1 percent.
Spot gold XAU= was little changed as markets shifted focus from hawkish comments by a Federal Reserve official over the weekend to a meeting of global central bankers this week, awaiting further guidance on U.S. interest rates.
The telecommunications group fell 0.4 percent, while utilities declined 0.6 percent.
Reporting by Fergal Smith; Editing by Nick Zieminski and Jonathan Oatis