May 26, 2008 / 2:33 PM / 11 years ago

UPDATE 1-Toronto stocks steady after strong start

(Adds details)

* Index flat after strong start

* Banks and energy shares gain

* Weak gold weighs on materials

TORONTO, May 26 (Reuters) - Toronto’s main index was little changed by midmorning on Monday as lofty oil prices boosted the resource-heavy index but materials shares were weighed by weaker gold in trading thinned by a U.S. holiday.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 8.01 points at 14,731.37 after hitting a high of 14,775.14 earlier in the day.

Seven of the TSX index’s 10 main groups rose, led by a 0.2 percent boost from the energy group and a 0.9 percent push from the utilities sector. Financial issues were up 0.4 percent.

Activity was light due to holiday closures in the key markets of the United States and the UK.

Energy shares climbed on the back of firm U.S. crude oil prices which rose 0.7 percent to $133.07 a barrel on supply worries in Nigeria and production problems in the North Sea. U.S. crude hit a high of $135.09 a barrel last week.

Talisman Energy TLM.TO was up 86 Canadian cents at C$24.04, while Imperial Oil (IMO.TO) gained 31 Canadian cents to C$59.17.

The financial sector, which like the energy sector accounts for about 30 percent of the overall index, rose ahead of a rush of second-quarter results from the big banks later this week.

The results are expected to show some calming from previous quarters when the institutions suffered under the weight of the global credit crunch.

“I don’t think this is going to be a huge, rip-roaring successful quarter, but at the same time I think the banks’ troubles for the most part are over and we may see at least some calming of the write-offs. I don’t think it is going to be a disastrous quarter at all,” said Fred Ketchen, director of equity trading at ScotiaMcLeod.

Bank of Montreal (BMO.TO) gained 29 Canadian cents to C$48.81 and Bank of Nova Scotia (BNS.TO) added 16 Canadian cents to C$47.76. Both banks are set to report on Tuesday.

A 0.4 percent drop in the resource-heavy materials group restricted gains as spot gold prices fell.

Agnico-Eagle Mines (AEM.TO) dropped 56 Canadian cents to C$70.48 and Barrick Gold (ABX.TO), the world’s biggest producer, dipped 30 Canadian cents to C$41.23.

$1=$0.99 Canadian Reporting by Scott Anderson; Editing by Bernadette Baum

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