(Updates at market close)

* TSX ends down 0.7% at 34,412.05

* BMO, Scotiabank and National Bank beat earnings

estimates

* Energy falls 2.4% as oil settles 5.55% lower

* Materials group declines 2.2% as gold falls

By Tharuniyaa Lakshmi and Fergal Smith

May 27 (Reuters) - Canada's commodity-linked main stock

index on Wednesday extended its pullback from a record high as

oil and gold prices dropped, and after some of Canada's major

banks reported quarterly results.

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

ended down 241.82 points, or 0.7%, at 34,412.05,

marking its second straight day of losses after touching a

record closing high on Monday.

* Canada's main stock index is set to post additional record

highs this year and in 2027 as elevated commodity prices and the

potential for energy companies to benefit from the increasing

power needs of artificial intelligence offset trade uncertainty,

a Reuters poll found.

* Canadian banks BMO Financial, Bank of Nova

Scotia ( BNS ) and National Bank of Canada ( NTIOF ) beat

analysts' estimates for quarterly profits, strengthened by

domestic business and capital markets income, while signaling an

optimistic outlook for Canada despite tensions in the Middle

East.

* "There may be a 'sell the news' phenomenon with respect to

the banks," said Allan Small, senior investment advisor of the

Allan Small Financial Group with iA Private Wealth. "They do

have good earnings, but their stock prices have gone way up in

advance of these earnings."

* Shares of BMO and Scotiabank rose 0.8% and 0.5%

respectively, while National's shares were down 4%.

* The price of oil settled 5.55% lower at $88.68 a

barrel. President Donald Trump said the United States and Iran

still have issues to resolve in peace talks, after Washington

dismissed an Iranian state television report of a framework deal

to restore shipping through the Strait of Hormuz within a month.

* Energy fell 2.4% and the materials group

, which includes metal mining shares, was down 2.2%.

* The price of gold dropped 1.2% on expectations of

tighter monetary policy to fend off rising inflation.

* Helping to limit the TSX's losses, the consumer staples

group rose 1.3% and industrials ended 0.6%

higher.