* TSX up 194.72 pts, or 1.6 pct, at 12,303.59
* Italy passes austerity measures package
* Mining stocks lead rally (Adds analyst's comments)
By Jon Cook
TORONTO, Nov 11 (Reuters) - Toronto's main stock index jumped more than 1 percent on Friday morrning as commodity prices rose on optimism that Italy would pass an austerity package that would calm fears about Europe's debt crisis.
Global stocks were buoyed by the Italian senate's vote in favor of a package of austerity measures that were demanded by the European Union in the face of Italy's severe debt problems. The package must still be passed by Italy's lower house, leaving a degree of investor nervousness. [MKTS/GLOB]
"Commodity prices look like they have some bounce to them," said Paul Taylor, chief investment officer at BMO Harris Investment Management Inc.
"If we get by the euro zone issues again, the economic indicators are inconsistent with an outright global economic recession, so that's not a bad backdrop for what we produce in abundance here in Canada," Taylor said.
After two straight down sessions, the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 194.72 points, or 1.6 percent, at 12,303.59.
The index's heavily weighted materials sector, home to base-metal and gold miners, surged more than 2.5 percent, nearly erasing Thursday's losses.
Barrick Gold Corp (ABX.TO) led the sector, rising 2.9 percent to C$53.49, even though bullion prices slipped as developments in Europe curbed safe-haven buying. [GOL/]
Base metals miners performed strongly, jumping 4 percent, led by Teck Resources TCKb.TO, which rose 4 percent to C$39.26. First Quantum Minerals (FM.TO) was up more than 7 percent at C$19.52 after falling more than 20 percent the last two sessions.
All of the index's 10 main sectors were higher, with energy and financials both up more than 1 percent.
($1=$1.01 Canadian) (Editing by Jeffrey Hodgson and Peter Galloway)