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TSX ends up 0.3% at 25,971.93

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Eclipses Thursday's record high

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MEG Energy ( MEGEF ) biggest gainer after takeover bid

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Investors remain cautious

(Updates to close)

By Nivedita Balu

May 16 (Reuters) - Canada's main stock index hit a

record high on Friday, closing firmer for a sixth consecutive

week, as worries about a global trade war eased after the

U.S.-China tariff truce over the weekend.

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

closed up 74.45 points, or 0.29%, at 25,971.93. The

index touched 25,992.89 on Friday, topping Thursday's record

high.

For the week, the index gained 2.5%.

The index's gains tracked those of Wall Street's main

indexes, which rose for the fifth straight day.

This week, the 90-day pause in the US-China tariff

dispute, along with the recent US-UK trade agreement, sparked

optimism for future US trade deals and helped ease recession

concerns.

"There's a lot of optimism right now. The markets are

being driven by momentum," said Michael Dehal, senior portfolio

manager at Dehal Investment Partners of Raymond James.

"But when you look at the sentiment of how people feel,

it's not really matching the momentum. I think people are still

a bit cautious, still kind of questioning this rally."

Data showed the U.S. consumer sentiment slumped further

in May, while one-year inflation expectations surged.

On Friday, U.S. President Donald Trump said U.S.

officials will send letters to countries in the coming weeks,

outlining the costs associated with doing business in the United

States, though he did not provide additional details.

On TSX, MEG Energy's ( MEGEF ) surged 18.7%, making it the

day's biggest gainer, after rival Strathcona announced

plans to launch a C$5.93 billion ($4.24 billion) hostile

takeover bid of the Canadian oil and gas producer. The energy

index gained 0.54%.

Healthcare stocks gained 3%, powered by a

9.7% gain in cannabis company Tilray Brands ( TLRY ).

($1 = 1.3971 Canadian dollars)