(Updated at 9:48 a.m. ET)

* Canada March retail sales down 0.2%

* TSX up 0.3%

* Lightspeed Commerce rises on CIBC rating upgrade

May 24 (Reuters) - Canada's main stock index opened higher on Friday as investors cheered softer retail sales data which cemented bets of a June interest rate cut by the Bank of Canada, while resource stocks led gains on higher commodity prices.

At 9:48 a.m. ET (13:48 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 76.19 points, or 0.34%, at 22,276.98.

Canada's retail sales contracted for a third consecutive month and dropped by 0.2% in March, while analysts polled by Reuters had forecast no change in retail sales from what they were in February.

"As the BoC starts to trim interest rates ahead, sales should have a floor under them, but mortgage renewals at higher interest rates relative to pandemic-era lows still suggest lacklustre consumer spending in the quarters ahead," Katherine Judge, Director & Senior Economist at CIBC Capital Markets, wrote in a note.

Earlier in the week, data also showed the country's annual inflation rate touched a three-year low in April.

Traders now anticipate the Bank of Canada to cut interest rates at its June 5 monetary policy meeting with a 60% probability, owing to the drop in inflation and lackluster economic growth.

Among sectors, the energy sector led sectoral gains with a 0.9% jump, tracking a rise in crude prices.

The materials sector, which includes precious and base metals miners and fertilizer companies, followed with a 0.5% uptick, supported by higher gold prices.

On a weekly basis, the benchmark S&P/TSX index looks set for its biggest drop since mid-April.

A sell-off in materials stocks due to lower metal prices and expectations of higher-for-longer U.S. interest rates weighed on Canadian equities despite the benchmark index securing an all-time high earlier in the week.

In corporate news, shares of cloud commerce solution provider Lightspeed Commerce climbed 5.3% to the top of TSX after CIBC upgraded its rating to 'outperformer' from 'neutral' and hiked its price target on the stock. (Reporting by Khushi Singh in Bengaluru; Editing by Ravi Prakash Kumar)