The Toronto Stock Exchange's S&P/TSX composite index ended down 77.00 points, or 0.4%, at 21,170.01. It notched last week a record closing high of 21,284.84.
"I think the Canadian earnings get quite a bit of strength backed by energy, material and financial sectors and a lot of that is already priced in," said Philip Petursson, chief investment strategist at IG Wealth Management.
"We're due for a little bit of a pause because the next stage in terms of the recovery and the reopening will show weaker earnings and some headwinds from the supply chain and just slower growth."
A preliminary estimate last Friday showed Canadian third-quarter GDP increasing at an annualized rate of 1.9%, much less than the Bank of Canada forecast at last week's policy announcement.
Investors were looking ahead to the outcome of the Fed's two-day meeting on Wednesday. The central bank is expected to approve plans to scale back its $120 billion monthly bond-buying program put in place to help the economy during the pandemic.
The energy sector fell 1.6%, retreating from a 30-month high on weakness in crude prices, while the materials group, which includes precious and base metals miners and fertilizer companies, lost 1.4%.
Bausch Health Cos Inc was among the leading decliners. Its shares fell 9.3% after the pharmaceutical company missed estimates for third-quarter revenue. The healthcare sector ended 3.5% lower.
Shares of Air Canada rose 4.4% after the company reported better-than-expected quarterly revenue. Canada's decision to open its borders to fully-vaccinated travelers and improving COVID-19 inoculation rates drove bookings at the country's largest carrier.
(Reporting by Fergal Smith; Additional reporting by Amal S in Bengaluru; Editing by Marguerita Choy)
By Fergal Smith
