CANADA-STOCKS-TSX rises to 3-week closing high as bank shares climb

(Adds portfolio manager quotes, details on Agnico Eagle, updates prices)

* TSX ends up 92.87 points, or 0.63 percent, at 14,826.09

* Index posts its highest close since Oct. 27

* Eight of the TSX’s 10 main groups end higher

By Fergal Smith

TORONTO, Nov 17 (Reuters) - Canada’s main stock index rose on Thursday to its highest close in three weeks as Canadian banks tracked gains for their U.S. counterparts on expectations that the Federal Reserve will raise interest rates in December.

Bond yields resumed their march higher since last week’s U.S. election as Fed Chair Janet Yellen said in congressional testimony that the election of Donald Trump as president has done nothing to change the Federal Reserve’s plans for a rate increase “relatively soon.”

Shares of banks have benefited from the move higher in bond yields, which improves their net interest margins.

“We’re being led higher by the banks, very strong moves by the Canadian banks that are following their U.S. brothers up higher,” said Barry Schwartz, portfolio manager at Baskin Financial Services.

Royal Bank of Canada rose 0.9 percent to C$86.83 and Bank of Nova Scotia added 1.4 percent to C$71.63, while the overall financials group gained 0.9 percent.

Suncor Energy Inc rose 0.5 percent to C$41.22 after it said it expected production to rise by more than 13 percent next year and spending to fall by more than C$1 billion.

But the overall energy group dipped 0.1 percent as oil fell.

U.S. crude oil futures settled 15 cents lower at $45.42 a barrel as a stronger U.S. dollar outweighed expectations of an OPEC deal to limit production.

Industrials advanced 1.2 percent, led by gains for railroad stocks, while the consumer discretionary group climbed 1.3 percent.

The Toronto Stock Exchange’s S&P/TSX composite index closed up 92.87 points, or 0.63 percent, at 14,826.09, its highest close since Oct. 27.

“For us to get sustainable higher levels on the Toronto market and to finally make all-time highs like the U.S. is making we will need to see a couple of things. We’ll need to see oil prices be significantly higher, we’ll need to see Canadian banks regain their glory and the market finally rewarding them for the earnings growth that they have and will have going forward,” Schwartz said.

Along with energy just one other group of the index’s 10 main groups ended lower.

The materials group, which includes precious and base metals miners and fertilizer companies, lost 0.8 percent.

Agnico Eagle Mines Ltd fell 2.9 percent to C$57.77, while spot gold fell to a 5-1/2-month low. (Additionial reporting by Alastair Sharp; Editing by Bernadette Baum and James Dalgleish)