(Updated at 10:09 a.m. ET/ 1409 GMT)

By Nikhil Sharma

Sept 12 (Reuters) - Canada's main stock index rose on

Thursday, helped by gains in mining stocks, after the latest

U.S. economic data further consolidated the possibility of a

quarter-basis-point rate cut next week.

The Toronto Stock Exchange's S&P/TSX composite index

was up 87.91 points, or 0.38%, at 23,299.08 and was

hovering near a record high.

Canada's materials sector led the gains with a

2.8% jump, helped by record-high gold prices along with a surge

in copper.

Leading the index were B2Gold Corp ( BTG ) and OceanaGold

Corp​ that gained 8.7% and 6.6%, respectively, whereas

Equinox Gold Corp​ rose 5.5%.

Domestic markets also reacted to economic data from the

United States, including the U.S. producer prices that rose

slightly more than expected in August, but the trend remained

consistent with subsiding inflation that confirmed the

possibility of a quarter-point cut by the Federal Reserve.

Markets are pricing in an 87% chance of a 25-basis points

reduction at the Sept. 18 policy meeting, while bets for a

50-bps cut stand at a mere 13%.

"Pundits have been a little too optimistic in the rate at

which rates could come down," said Michael Sprung, president at

Sprung Investment Management.

U.S. weekly jobless claims rose marginally last week,

pointing to a still-low level of layoffs even as the labor

market slows.

Back home, among the biggest laggards in the index, Shopify

Inc​​ was down 2.2%, GFL Environmental ( GFL )

dropped 1.7%, and Ballard Power Systems ( BLDP ) slid 1.1%.

The most heavily traded shares by volume were B2gold Corp ( BTG )

, Altagas Ltd ( ATGFF ) and Calibre Mining Corp. ( CXBMF )

The TSX's heavyweights energy group climbed 1%,

while the financials sector rose 0.2%.

In oil markets, prices indicated by the West Texas

Intermediate crude futures rose 0.92%, while Brent crude

rose 0.78%. Gold gained more than 1%.

Crude oil and gold are among Canada's top exports.

The TSX is up 11.4% for the year.