* TSX rallies to highest level since Jan. 16
* Stock gains fueled by hopes for U.S. stimulus plan
* Canadian and U.S. economies bleed jobs in January (Adds details)
By Frank Pingue
TORONTO, Feb 6 (Reuters) - Toronto's key stock index shot to its highest level in three weeks on Friday as dismal U.S. jobs data fueled hopes for passage of a U.S. stimulus package and helped steer focus away from a weak Canadian jobs report.
The Democratic-led U.S. Senate will try again on Friday to pass a $937 billion stimulus package aimed at boosting the battered economy. [ID:nN05403943]
"You've got some people kicking some tires on some of these stocks out here that are starting to look like they are bottoming," said Bruce Latimer, trader at Dundee Securities.
Key stocks fueling Friday's gain included fertilizer company Potash Corp of Saskatchewan (POT.TO), which rallied 6.3 percent to C$112.81, and BlackBerry maker Research In Motion RIM.TO, which rose 5.6 percent to C$73.85.
The rally also followed Canadian data that showed the economy suffered its worst job losses in more than three decades in January. The U.S. economy lost the most jobs in 34 years last month.
At 10:50 a.m. (1550 GMT), the S&P/TSX composite index .GSPTSE was up 111.67 points, or 1.26 percent, at 8,972.65 after falling 36 points at the open.
Shortly after falling at the open, the TSX rose 1.6 percent to 9,005.88, its highest level since Jan. 16.
The information technology group rose 2.85 percent to lead all sectors, followed by a gain of 2.3 percent in the materials group. Eight of the TSX's 10 sectors were higher.
The energy sector, which accounts for about 22 percent of the S&P/TSX composite, was mostly unchanged as oil prices fell below $40 a barrel.
$1=$1.24 Canadian Editing by Peter Galloway