* Bank results top expectations, spark rally
* Energy group boosted by rising price of oil
* Drop in gold price holds back materials group (Adds details)
By Ka Yan Ng
TORONTO, Feb 26 (Reuters) - Toronto’s main stock index climbed more than 3 percent on Thursday morning, lifted by bank earnings that topped expectations and supported by rising crude prices.
A mix of financials and energy stocks were among the biggest contributors to the index’s rise, with Royal Bank of Canada (RY.TO), the biggest contributor, up 6.7 percent at C$31.99.
RBC reported a 15 percent drop in quarterly profit, but beat analysts’ expectations after market-related losses and other items were excluded. [ID:nN26542233]
Other banks also rose, pushing the financials group up more than 6 percent. CIBC (CM.TO) and National Bank of Canada (NA.TO) joined RBC in reporting underlying results that came in ahead of expectations.
CIBC rose 4.8 percent to C$45.36, while National Bank gained 8 percent to C$37.08.
U.S. banking stocks added support with strong gains following news that the U.S. government may request money to shore up banks.
The price of oil neared $45 a barrel, up more than $2, and helped the energy group gain 5.4 percent. Among the big advancers were Suncor Energy (SU.TO), up 10 percent at C$25.40, and Canadian Natural Resources (CNQ.TO), up 7.5 percent at C$42.55.
“I think it’s energy and financials that are really driving the bus here at the moment,” said Lex Kerkovius, senior research analyst at McLean & Partners Wealth Management in Calgary.
At 10:45 a.m. (1545 GMT), the S&P/TSX composite index .GSPTSE rose 247.92 points, or 3.13 percent, to 8,180.22. Seven of the index’s 10 main groups advanced.
The easing price of gold held back the materials group. Gold miners were among the key decliners, with Barrick Gold (ABX.TO) leading the way down. Barrick dropped 3.7 percent to C$37.68. Most other constituents of the TSX’s materials sector, including timber, fertilizer and base metals companies, were on the rise.
Biovail BVF.TO fell 2.3 percent to C$13.40 as Canada’s biggest publicly traded drugmaker posted a quarterly profit helped by a large deferred income tax benefit, but revenue fell. [ID:nN26539694]
Newspaper and book publisher Torstar Corp (TSb.TO) fell nearly 10 percent to C$5.76 after it reported a quarterly loss and cut its annual dividend by half. The company also announced that Chief Executive Robert Prichard has decided to step down. [ID:nBNG429814] (Reporting by Ka Yan Ng; Editing by Peter Galloway)