TORONTO (Reuters) - Canadian stocks staged a late rally to close higher on Wednesday, shrugging off early losses, helped by encouraging third-quarter earnings and news from Europe about plans to tackle the region's debt crisis.
Markets responded positively to a report the euro zone will dip deeply into a $440 billion euro bailout fund, the details of which won't be revealed until November, according to a draft statement obtained by Reuters.
Still, analysts said the uncertainly about the outcome of the European summit was a weight on the market.
"On the one side you have the European headwinds that are negative and making the market very jittery," said Luciano Orengo, a portfolio manager at Manulife Asset Management. "On the other side you've been having third-quarter earnings that are coming in better than expected."
The Toronto Stock Exchange's S&P/TSX composite index closed up 76.31 points, or 0.63 percent, to 12,186.06. That corrected a brief negative spell earlier in the day when the index weakened to 12,052.53.
Canadian National Railway Co among the most influential gainers, rising 1.9 percent to C$76.56, after reporting a 19 percent jump in quarterly profit late on Tuesday.
Energy and materials stocks, including miners, played the biggest role in leading the market higher.
Base-metal miners climbed more than 4 percent as copper prices rallied. Teck Resources climbed 4.2 percent to C$37.33, while First Quantum Minerals gained 8 percent to C$18.60.
Research In Motion was the biggest drag on the index, dropping 7.5 percent to C$20.89. The BlackBerry maker fell after delaying a software upgrade for its PlayBook tablet until February, months behind schedule.
Canadian telecoms were also down slightly, though Rogers Communications edged up 1.15 percent to C$35.93 after reporting a slightly higher adjusted profit.
Telus Corp was hardest hit, declining 1.7 percent to C$53.79.
"The earnings are coming through ... but the common theme is people are cautious about making strong projections going forward," said Peter Chandler, senior vice-president and director at Canaccord Wealth Management.
Additional reporting by Claire Sibonney; Editing by Jeffrey Hodgson