(Adds investor comment, updates prices to close)
* TSX ends up 98.19 points, or 0.75 percent, at 13,150.93
* Seven of the TSX's 10 main groups rise
By Alastair Sharp
TORONTO, Aug 25 (Reuters) - Canada's main stock index
finished modestly higher on Tuesday after surging as much as 3
percent following China's decision to cut interest rates and
banks' reserve requirement to kick-start economic growth.
The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE ended up 98.19 points, or 0.75 percent, at 13,150.93.
It had risen sharply at the open following Monday's global
rout, as the People's Bank of China's 25 basis point cut in key
rates and 50 basis points off the reserve requirement rate for
large commercial banks helped global markets rebound.
The index's heavyweight financial and energy groups, up 2
percent and 1.5 percent respectively, helped steer it to a
positive finish, as the price of oil recovered somewhat.
But jittery investors, knocked around by several sessions of
sharp declines, were unwilling to make drastic moves.
"It's emotion, it's sentiment, and the market is getting
pushed back and forth," said Rick Hutcheon, chief operating
officer of RKH Investments. "Let the tidal wave, the tsunami
play itself out and then we'll figure out what's going on."
Hutcheon said he has not sold a single share during the
index's plunge and is very tempted to buy in at these levels.
"As soon as I get some sense of sanity and rational decision
making, that's probably exactly what I'll do," he said.
Seven of the index's 10 key groups gained, with 169
advancers and 78 decliners, for a 2.17-to-1 ratio on the upside.
"Even though the markets are up ... a lot of investors are
still skeptical," said Irwin Michael, portfolio manager at ABC
Funds.
Banks, which report quarterly results this week, were the
index leaders, with Toronto-Dominion Bank TD.TO adding 2.7
percent to C$50.35. Royal Bank of Canada RY.TO advanced 2.3
percent to C$72.36.
Bank of Montreal BMO.TO rallied 2.5 percent to C$67.82
after reporting a third-quarter profit that topped expectations.
Investors may have been too negative on bank earnings, said
Michael, adding that BMO's results could spark more optimism for
other institutions reporting this week.
The financials group had tumbled 2.8 percent on Monday.
Prior to Tuesday's gains, it had fallen more than 9 percent
through August.
Energy shares also gained after losing 9.4 percent last week
and Monday. While U.S. oil rose 3 percent, prices still hovered
near 6-1/2 year lows under $40 a barrel.
Suncor Energy SU.TO rose 2.1 percent to C$33.62.