* TSX up 0.44%, helped by tech and materials

* U.S. and Iran have agreed to extend ceasefire, sources

say

* Canada's Q1 GDP contracts in the first quarter

By Niket Nishant

May 29 (Reuters) - Canada's main stock index climbed on

Friday and was on course for its second consecutive month of

gains, as renewed hopes for a Middle East peace deal buoyed

investor sentiment.

At 11:17 a.m. ET, the Toronto Stock Exchange's S&P/TSX Composite

Index was up 0.44% at 34,670.36 points. It has gained

2.08% so far this month.

* The United States and Iran on Thursday agreed to extend

their ceasefire and lift restrictions on shipping through the

Strait of Hormuz, sources told Reuters, though the deal still

needs U.S. President Donald Trump's signoff.

* The technology sector gained 3.5%, while

materials rose 2.2%.

* Spot gold prices rose for a second straight

session, helping shares of gold miners.

* Energy stocks fell as oil prices declined 1.9%

on hopes that shipping through the Strait of Hormuz, a vital

artery for global oil flows, could resume soon.

* However, gains on Friday were kept in check by GDP data

that showed Canada's economy posted a surprise contraction in

the first quarter, compared with the year before.

* The contraction marks the second straight quarter of

annualized decline, which some economists call a technical

recession.

* "Overall, this was a very weak report from most angles

that shows that trade uncertainty and tariffs are continuing to

hold back growth, while consumers have little ammunition left

for spending ahead," said Katherine Judge, senior economist at

CIBC Capital Markets.

* On Thursday, the Bank of Canada said the domestic

financial system was in good shape, but vulnerabilities were

growing.