(Updates with analyst comment, market open prices)

By Sanchayaita Roy

Sept 4 (Reuters) - Canada's main stock index hovered

near a record high on Thursday, as investors awaited employment

data that could influence the Bank of Canada's September

interest-rate decision.

The S&P/TSX composite index was up 0.03% at

28,760.46, easing off its record peak touched earlier in the

session.

The index has logged three consecutive record closing highs

since Friday after a GDP report showed Canada's economy

contracted more than expected in the second quarter, prompting

market expectations for a potential rate cut.

Canada and the U.S. are set to release August employment

reports on Friday, which could play a pivotal role in shaping

the central banks' policy decisions.

Economists forecast Canada's economy added 10,000 jobs and

the unemployment rate rose to 7% from 6.9% a month earlier.

"The Federal Reserve is likely going to cut (interest rate)

and that's what the market's expecting and that gives the BoC

room to cut as well," said Martin Pelletier, senior portfolio

manager at TriVest Wealth Counsel.

"Both economies are weakening, but Canada is substantially

weaker and going to be impacted by more so from the tariffs

dispute. And the BoC is going to have to act prudently to adjust

for that."

Money markets see a 67.6% chance of a 25-basis-point

interest-rate cut on September 17. The benchmark rate is at

2.75%.

The TSX's technology sector rose 0.8%, led by

Descartes' 5.5% gains after the supply chain technology

provider beat quarterly revenue estimates.

Conversely, commodity-heavy material and energy

stocks fell 0.5% each, tracking losses in oil and gold

prices.

Data showed on Thursday Canada's trade deficit narrowed in

July as overall exports rose.

Separate data revealed U.S. private payrolls increased less

than expected in August, while weekly jobless claims were higher

than expected. The focus now shifts to Friday's highly

anticipated nonfarm payrolls data.