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TSX ends down 0.4% at 23,037.47

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Two biggest rail operators lock out workers

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TD Bank reports quarterly loss

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Materials group falls 1.6%; tech loses 1.5%

By Fergal Smith

TORONTO, Aug 22 (Reuters) - Canada's main stock index

pulled back from a record high on Thursday as Toronto-Dominion

Bank ( MLWIQXX ) reported its first loss in over two decades and a railroad

stoppage threatened to disrupt the domestic economy.

The S&P/TSX composite index ended down 84.26

points, or 0.4%, at 23,037.47, after posting a record closing

high on Wednesday.

U.S. stocks also fell as central bank officials from around

the world gathered in Jackson Hole for the annual Economic

Symposium, with investors laser focused on Fed Chair Jerome

Powell's address on Friday for clues on the timing and extent of

the Fed's policy easing cycle.

Canada's economy could shrink by billions of dollars this

year after the country's two biggest freight rail operators

locked out workers affiliated with the Teamsters union on

Thursday, after both companies and the union failed to conclude

labor deals.

Still, shares of both companies, Canadian National Railway

Co ( CNI ) and Canadian Pacific Kansas City Ltd ( CP ), ended

higher.

"Given that rails are crucial for so many businesses, it's

difficult to see this being a prolonged lockout," said Ben Jang,

a portfolio manager at Nicola Wealth. "The government may step

in sooner versus later."

TD Bank shares fell 2.1% as the bank reported a

quarterly loss after setting aside an extra $2.6 billion to

cover expected fines from U.S. regulators, which have been

probing weaknesses in Canada's second-largest lender's

anti-money laundering controls.

It's still to be seen how much scrutiny the bank could face

as it tries to expand in the U.S. and how that "would impact

future growth prospects," Jang said.

The technology sector fell 1.5%, along with declines for

U.S. tech stocks. The materials group, which includes metal

miners and fertilizer companies, was down 1.6% as gold prices

fell, giving back some recent record-setting gains.