From Kalsbeek et al 1999 Neuroscience (link 1, link 2)
> "retina-mediated photic activation of suprachiasmatic nucleus neurons induces the release of GABA from efferent suprachiasmatic nucleus nerve terminals, resulting in an inhibition of melatonin release by the pineal gland."
So it appears that GABA is key. When the retina is stimulated by light it results in activation of the neurons within the SCN which then release GABA. There is much more detail within the article and this is not my field so you may get more from reading that rather than my summary attempts.