TORONTO (Reuters) - Toronto's main stock index ended higher yesterday after Toronto-Dominion Bank reported a higher quarterly profit and US economic data added to investor optimism about recovery.

Heavily weighted banking issues were up 1.1 percent after the last of the bank quarterly reports was released. TD was up 1.5 percent at C$73.17 after it reported a 29 percent rise in third-quarter profit on stronger retail banking profits and credit quality.

Elsewhere in the sector, Bank of Montreal was up one percent at C$59.30, while Bank of Nova Scotia rose 1.9 percent to C$52.21. Royal Bank of Canada climbed 0.5 percent, Canadian Imperial Bank of Commerce rose 0.3 percent and National Bank of Canada was up one percent.

The Toronto Stock Exchange's S&P/TSX composite index finished the day up 107.31 points, or 0.89 percent, at 12,111.09, its seventh straight day of gains.

Nine of its 10 main groups were higher.

Market players are anxiously awaiting yesterday's key US non-farm payrolls report for signs of where the US economy is headed.

"What people want to see is some evidence that the US economy is growing even if only slowly," said David Baskin, portfolio manager and president of Baskin Financial Services.

"People want some positive data points to relieve this gloom that we had for a lot of summer."

The index's resource-laden materials group was up 1.3 percent, helped by a rally in spot gold pricesKinross Gold was up 1.9 percent at C$17.93, while fellow gold miner Agnico Eagle gained 1.3 percent to C$68.64.

Steve Ibel, institutional equities trader at Beacon Securities, in Halifax, Nova Scotia, said 12,100-12,150 was likely an key short-term target level for the TSX index.

Canada's dollar turned lower against the US currency yesterday, giving up some of the previous session's strong gains, with market players guarded a day before a key US employment report.

Investors will be closely monitoring August's non-farm payrolls report today for signs of whether the US economy can forge a stronger recovery after yester's data eased fears of a new recession.