* Index up 2.7 pct on day, 7.8 pct on week
* U.S. bank stress tests boost investor optimism
* Canada unexpectedly adds 35,900 jobs in April
* Energy group, up 5.7 percent, leads TSX rally (Updates to close, adds quotes, details)
By Jennifer Kwan
TORONTO, May 8 (Reuters) - Toronto’s main stock index shot to its highest close in more than six months on Friday, buoyed by higher oil prices and rising optimism over surprisingly strong jobs data and the outlook for the U.S. financial system.
“We’re coming out of a period where people were throwing around the Depression word,” said Jennifer Radman, vice-president Caldwell Investment Management Ltd. “Now we’re kind of seeing, maybe, it’s not that bad.”
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 270.94 points, or 2.72 percent, at 10,237.99, with nine of its 10 main sectors higher. The TSX was up 7.8 percent on the week.
Healthier than expected Canadian and U.S. jobs figures on Friday fueled the upbeat mood. [ID:nN08444159] [ID:nN08455623]
Canada unexpectedly added 35,900 jobs in April, surprising analysts who had expected the economy to continue shedding jobs. The jobless rate remained at 8.0 percent.
In the U.S., employers cut 539,000 jobs in April, the fewest since October and below analyst forecasts. The unemployment rate there rose to 8.9 percent.
As well, so-called stress tests of U.S. banks came in much as analysts had expected, adding to the more upbeat mood.
The reviews showed 10 banks needed additional capital to withstand heavier losses that would likely come if the recession worsened. U.S. regulators told top banks on Thursday to raise $74.6 billion to build a capital cushion. [ID:nL8520410]
The energy group rose 5.7 percent, bolstered by a firm oil price that climbed to settle above $58 a barrel. [ID:nSP435537]