TORONTO (Reuters) - Toronto's main stock index ended at a 15-month high yesterday, led by a rally in shares of Potash Corp. of Saskatchewan after the big fertiliser company was upgraded to "outperform" by Credit Suisse.

Potash Corp. was the leading heavyweight advancer all through the session. It ended up 5.41 percent at C$123, which helped the TSX index reach its highest level since September 2008 and record its fourth straight higher close.

Prices for precious metals and crude oil were also higher, and while gold cut initial gains to turn lower, the overall tone to the index's energy and materials groups was solidly higher, and they rose 0.24 percent and 1.76 percent, respectively.

"There's follow-through buying from yesterday. The fact that the US dollar is lower seems to help," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

The Toronto Stock Exchange's S&P/TSX composite index ended up 21.18 points, or 0.18 percent, at 11,888.08.

Financials were the loss leaders. Analysts cited profit-taking after the sector ran up sharply in December, while disappointing US home sales data chipped away at sentiment about economic recovery.

Royal Bank of Canada was the biggest drag on the index, falling 1.5 percent to C$55.75.

The Canadian dollar touched a two-and-a-half month high against the US dollar yesterday as the greenback sagged and the commodity-linked currency got a lift from strength in oil prices.

Earlier in the session, the currency touched a high of C$1.0336 to the US dollar, or 96.75 US cents, its highest level since October 20.

The rise was aided by a higher price for crude oil, a major Canadian export, which marched toward $82 a barrel, boosted in part by frigid weather in the US and Europe, which increased demand for heating fuel.

"What's happening is commodity prices are improving in the wake of continued recovery in the global economy," said Michael Gregory, senior economist at BMO Capital Markets, referring to recent manufacturing data from the U.S. and China.---- "The industrial part of the global economy, which is the consumer of raw materials, is picking up and that ultimately provides support for commodities and the Canadian dollar. That's the fundamental theme."