Canada's main stock index rallied on Monday, powered in part by Royal Bank of Canada, which helped the heavily weighted financial stocks, and energy gains fuelled by a jump in oil prices.

The Toronto Stock Exchange's S&P/TSX composite index closed up 91.59 points, or 0.59 per cent, at 15,629.47.

All of the index's 10 main groups advanced.

"On balance, we think the market will saw-tooth its way higher to the end of the year," said Irwin Michael, portfolio manager at ABC Funds.

Royal Bank of Canada (RY.TO) was by far the most influential stock on the index, and advanced 1.2 per cent to $93.62. It was followed by Toronto Dominion Bank (TD.TO), which rose 0.9 per cent to $63.67.

"Good quality dividend-paying stocks are relatively attractive compared to the bond market," said Michael.

The overall financials group gained 0.8 per cent. Home Capital Group Inc (HCG.TO) gave up most of its gains during the session after Reuters reported that Canada's largest non-bank lender may need to draw down more from a high-interest credit facility in order to meet a debt repayment due next week. Its shares came off an intraday gain of 12.8 per cent to finish up 0.3 per cent at $9.17.

Energy stocks climbed 1.1 per cent on the back of oil prices that touched their strongest level in more than three weeks on Monday after Saudi Arabia and Russia supported an extension of supply cuts into 2018. Canada's energy sector is sensitive to the global price of oil. U.S. crude prices were up 1.9 per cent to US$48.76 a barrel.

Canadian Natural Resources Ltd (CNQ.TO) rose 1.5 per cent to $42.89, while Suncor Energy Inc (SU.TO) was up 0.9 per cent at $43.85.

Canada's two biggest rail operators were also influential gainers, helping lift the industrials group by 0.9 per cent. Canadian National Railway Co (CNR.TO) climbed 1.3 per cent to $103, while Canadian Pacific Railway (CP.TO) added 2.1 per cent to finish at $217.47.

On the downside, news that Eldorado Gold Corp (ELD.TO) will buy Integra Gold Corp (ICG.V) sent Eldorado's shares down 7.8 per cent to $4.61, tempering some of the materials group's 0.3-per-cent gain.

Advancing issues outnumbered declining ones on the TSX by 176 to 72, for a 2.44-to-1 ratio on the upside.

The index was posting 12 new 52-week highs and one new low.

U.S. STOCKS

The S&P 500 and the Nasdaq notched record closing highs on Monday, powered by demand for technology stocks after a global cyber attack and by rising oil prices.

Oil rose to the highest level in more than three weeks after top exporters Saudi Arabia and Russia said supply cuts needed to last into 2018, a step toward extending an OPEC-led deal to support prices for longer than originally agreed.

The rising oil prices and housing data drove optimism about the economy and helped make financial stocks the second biggest driver for the S&P 500, behind the technology sector .

"The oil markets are acting well and that's helping," said R.J. Grant, head of trading at Keefe, Bruyette & Woods in New York, who also cited the strong corporate earnings season.

About 75 per cent of S&P 500 companies that have reported quarterly results so far have beaten Wall Street expectations, according to Thomson Reuters data.

While data for New York state's manufacturing sector was weaker than expected, U.S. homebuilder sentiment gave investors some confidence in the economy.

"We need that because there's been a tug-of-war in this market as to whether this economy is peaking," Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey, said, referring to the housing sentiment.

The Dow Jones Industrial Average was up 85.33 points, or 0.41 per cent, to 20,981.94, the S&P 500 gained 11.42 points, or 0.48 per cent, to 2,402.32 and the Nasdaq Composite added 28.44 points, or 0.46 per cent, to 6,149.67.

Johnson & Johnson (JNJ.N) and Cisco Systems (CSCO.O) were the biggest drivers for the S&P 500 after prominent analysts upgraded their ratings on the stocks.

Shares of cybersecurity firms jumped on expectations that they would benefit from greater spending after the global "ransomware" attack that began spreading across the globe on Friday. Shares of FirEye (FEYE.O)  rose 7.5 per cent, and Symantec (SYMC.O) and Palo Alto Networks (PANW.N) both gained around three per cent. The 2.3-per-cent rise in Cisco was driven in party by its security technology business.

Nine of the 11 major S&P 500 sectors closed higher, with the materials index leading the percentage gainers.

Advancing issues outnumbered declining ones on the NYSE by a 3.10-to-1 ratio; on Nasdaq, a 2.04-to-1 ratio favored advancers.

The S&P 500 posted 46 new 52-week highs and 10 new lows; the Nasdaq Composite recorded 144 new highs and 53 new lows.

About 6.3 billion shares changed hands on U.S. exchanges on Monday compared with the 6.8 billion average for the last 20 sessions.