* TSX up 1.81 percent at 10,556.64
* TSX at highest level since June 12
* Materials group up 2.64 percent (Adds details, quote)
By Nina Lex
TORONTO, July 20 (Reuters) - Toronto’s main stock index rose more than 1 percent on Monday morning as firmer oil and metals prices helped lift the resource-heavy index to its highest level since June 12.
The index’s mining-laden materials group led the rise with a 2.64 percent gain on higher gold prices. Gold was up as the U.S. dollar slipped to a six-week low, boosting the precious metal’s appeal as a currency hedge. [ID:nLK3592] Goldcorp G.TO rose 3.5 percent at C$42.28 and Barrick Gold ABX.TO was up 2.24 percent at C$39.30.
The index’s energy sector gained 2.29 percent as the price of oil rose to around $64 a barrel. Canadian Natural Resources CNQ.TO shares were up 3.3 percent to C$65.08, EnCana ECA.TO rose 2.4 percent to C$58.03, and Petro-Canada PCA.TO was up 3.28 percent at C$44.69.
The financial sector rose 1.32 percent. Manulife Financial MFC.TO was the TSX’s biggest heavyweight gainer, up 3.67 percent to C$22.62. Bank of Nova Scotia BNS.TO was up 0.70 percent to C$43.30 and Bank of Montreal BMO.TO rose 1.10 percent at C$49.70.
“(The rise in financials) is a matter of confidence. The worst hasn’t happened, people were expecting the worst,” said Irwin Michael, portfolio manager at ABC Funds. “It’s a real tug-of-war between the bulls and the bears.”
At 10:05 a.m. (1405 GMT), the S&P/TSX composite index .GSPTSE was up 187.22 points, or 1.81 percent, at 10,556.64. All of its 10 main groups were higher.
“It’s a very big week for earnings. If second quarter earnings are reasonable or better than what people expect, it should continue to move up,” Michael said.
$1=$1.11 Canadian Reporting by Nina Lex; editing by Peter Galloway