The Toronto stock market closed lower but well off its early plunge amid fresh hopes that European officials are moving to control damage from the European debt crisis.
The S&P/TSX composite index came back from a 404-point drop to close down 73.92 points at 11,177.91 after the Financial Times reported that euro zone officials were studying a bank recapitalization plan.
Investors have been concerned over the last couple of months about the slowing pace of economic revival and a possible default by Greece, which would worsen economic conditions and wreak havoc on the European financial sector.
Falling commodities helped push the loonie down 0.34 of a cent to 94.8 cents (U.S.), with oil falling $1.94 to $75.67 a barrel.
U.S. markets made a big turn-around late in the session with the Dow Jones industrial index up 153.41 points at 10,808.71.
The Nasdaq composite index pushed up 68.99 points to 2,404.82 while the S&P 500 index gained 24.72 points to 1,123.95.