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TSX ends down 0.2% at 26,692.32

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For the week, the index gains 0.7%

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Materials group falls 2.8% as gold drops

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Energy ends 0.5% lower

(Updates at market close)

By Fergal Smith

June 27 (Reuters) - Canada's main stock index pulled

back on Friday from a record high, weighed by declines for

mining shares, as data showed the domestic economy contracting

and after U.S. President Donald Trump shattered optimism that

the United States would reach a tariff deal with Canada.

The S&P/TSX composite index ended down 59.63

points, or 0.2%, at 26,692.32, after posting a record closing

high on Thursday. For the week, the index was up 0.7% as cooling

Middle East tensions boosted investor sentiment.

The market has benefited recently from some good news and

the reduction of outsized risks, said Ben Jang, a portfolio

manager at Nicola Wealth.

"But that doesn't mean that economic scarring hasn't

occurred," Jang said.

Canada's economy contracted by 0.1% in April from March as

U.S. tariff uncertainty weighed on the goods-producing sector.

Preliminary data pointed to a further decline in activity for

May.

Trump abruptly cut off trade talks with Canada over its new

tax targeting U.S. technology firms, calling it a "blatant

attack" and saying that he would set a new tariff rate on

Canadian goods within the next week.

The materials group, which includes fertilizer companies and

metal mining stocks, fell 2.8% as easing of U.S.-China trade

tensions reduced the appeal of safe-haven gold.

Energy also ended lower, falling 0.5%, as the price of oil

posted a steep weekly decline.

TC Energy Corp ( TRP ) was a bright spot. Its shares rose

2.4% after the company started collecting tolls for the

Southeast Gateway natural gas pipeline in Mexico.

Seven of 10 major sectors ended higher, with real estate

adding 0.7% as long-term borrowing costs fell.

The Canadian 10-year eased 2.5 basis points to 3.315%,

pulling back from an earlier one-week high.