* Main index up 31.76 points, or 0.3 percent, at 12,497.20
* Tentative trading as Europe deal optimism fades
* Materials, gold miners drive early rise
By Jon Cook
TORONTO, Oct 28 (Reuters) - Canadian stocks edged higher in early action on Friday, led by a rise in shares of gold miners, even as fading optimism over a European debt deal weighed on the broader market.
Trading was somewhat tentative a day after the TSX jumped more than 2 percent to hit a near two-month high on investor optimism following the euro zone’s latest debt crisis plan.
“As we remove this sword of Damocles from Europe that means that securities selection and earnings analysis can shine through,” said Stephen Wood, chief investment strategist for North America at Russell Investments in New York.
The materials sector and gold miners were the biggest early drivers. With gold on track for its best weekly gain in two months, the Canadian gold mining sector rose 2.3 percent. [GOL/]
Barrick Gold (ABX.TO) led the sector and broader market higher, jumping 3.3 percent to C$50.23. Goldcorp Inc (G.TO) rose 3 percent to C$49.29.
At 10:30 a.m. (1430 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 31.76 points, or 0.3 percent, to 12,497.20. The TSX began the day down 4.39 points, or 0.4 percent, at 12,461.05.
By contrast, U.S. and European stocks fell as investors booked profits after the prior session’s strong rally and a disappointing Italian debt auction showed investor confidence in Europe remained shaky despite the latest rescue deal. [MKTS/GLOB]
Despite European leaders drafting a plan to tackle the region’s debt crisis, investors had hoped for more concrete details on how the agreement specifically addresses lenders with Greek debt holdings and bank recapitalization.
Markets paid little heed to U.S. government data showing consumer income grew by a sluggish 0.1 percent in September, and a separate report showing wages and salaries expanded 0.3 percent in the third quarter -- the smallest rise in a year. (Reporting by Jon Cook; Editing by Jeffrey Hodgson)