The second one is more correct.

They're both correct. If you're thinking of candy as 'stuff' ( a product/substance), you can use the singular form. If you say "A lot of candy is pink", the word 'candy' is an uncountable noun. If you're thinking of candies as 'things' ( individual objects or types of objects) ,you can use the plural form. If you say "A lot of candies are pink", the word 'candies' is a countable noun.

you could really use either. a lot of candies are pink may sound slightly better.

The second, in my opinion. A lot of candy is a big pile of candy. A lot of candies refers to many different kinds of candy, so makes more sense for the context of this statement. Although, the first *could* be read to mean the same thing, so would also probably be OK.