(Updates with prices)

By Sanchayaita Roy

May 26 (Reuters) - Canada's main stock index surged on

Monday, after U.S. President Donald Trump extended the deadline

for European Union trade talks, providing a brief respite to

investor concerns over his erratic trade policies.

The Toronto Stock Exchange's S&P/TSX composite index

was up 0.6% at 25,024.83 points.

On Sunday, Trump backed away from his threat to impose 50%

tariffs on EU imports to July 9 from June 1, after European

Commission President Ursula von der Leyen said the 27-nation

bloc needed more time to produce a deal.

However, despite global market sentiment steadying after new

trade deals with the UK and China earlier this month, Trump's

sweeping tariffs and pauses since April 2 continue to generate

uncertainty among investors and companies.

"We are still continuing to play the game of reacting to

short term (trade) announcements and letting it move markets,"

said Colin White, president and chief executive officer at

Verecan Capital Management.

"The bigger issue that's getting a little less press is

what's going on in the bond market ... that are probably more

important to what expectations are for the global economy."

U.S. Treasury yields have climbed in recent weeks on concern

about a worsening fiscal outlook for the U.S.

Focus will be on Statistics Canada's first-quarter GDP data

on May 30, ahead of the central bank's interest rate decision

next week.

"It'll be interesting to see how much of impact actually

shows up in these numbers and that should inform going forward

as to how much attention should be paid to future

announcements," Colin added.

On the TSX, the information and technology sector

gained 1.1%.

Energy stocks gained 0.8%, though oil prices were

about flat.