(Updates with morning prices, adds analyst quotes)

By Sanchayaita Roy

July 21 (Reuters) - Canada's commodity-heavy main stock

index on Monday rebounded from the previous session's losses,

led by gains in mining stocks, while investors looked for

potential trade deals between the U.S. and its key trading

partners.

The S&P/TSX composite index was up 0.2% at

27,372.76 points.

In the latest trade development, U.S. Commerce Secretary

Howard Lutnick said on Sunday he was confident that Washington

could secure a trade deal with the EU, but August 1 is a hard

deadline for tariffs to kick in.

However, EU diplomats said the 27-member bloc is exploring a

broader set of possible counter-measures against the U.S., as

hopes for a breakthrough deal with Washington dwindled.

Traders awaited clarity on U.S.-EU trade talks and looked

for additional deals from major U.S. trading partners ahead of

President Donald Trump's August 1 tariff deadline.

"It (aspects of a potential trade deal) just seems to go

back and forth...trying to forecast what's going to happen has

consistently got investors burned over the past few months",

said Josh Sheluk, portfolio manager at Verecan Capital

Management.

He added that it is better for investors to stay patient

and avoid getting caught up in the daily noise around tariffs.

Meanwhile, domestic investors looked forward to the Bank of

Canada's Business Outlook Survey, due later in the day, for

business expectations amid tariff-related uncertainty.

On the TSX, materials stocks led the sectoral

gains with a 2.3% rise, tracking gold prices.

Energy subindex fell 0.4% as oil prices slightly

dipped.

Among individual stocks, Osisko Development rose

2.2% after the mineral exploration company announced a $450

million credit agreement with funds advised by Appian Capital

Advisory.

In the U.S., several industrial and tech firms are set to

report their earnings this week, with Alphabet and

Tesla kicking off the results season for the

"Magnificent Seven" stocks.