CANADA STOCKS-TSX gains in low volumes, big banks weigh

(Adds portfolio manager comment, updates prices to close)

* TSX ends up 49.78 points, or 0.38 percent, at 13,084.16

* Nine of the TSX’s 10 main groups rise

TORONTO, Dec 22 (Reuters) - Canada’s main stock index gained on muted advances across a range of sectors in low-volume trade on Tuesday, with rises in industrial, telecom and resource stocks offsetting a subdued performance from some of the country’s biggest banks.

The index has recovered somewhat from a two-year low hit in mid-December, but investors are not excited by the prospects for Canadian equities in the first half of 2016.

“It slows down into the year-end, but when you look at the data on the other side, there doesn’t seem to be anything to get too excited about,” said Manash Goswami, portfolio manager at First Asset Investment Management Inc. “I want to be where GDP growth is higher, and that is the U.S. over Canada.”

Goswami said investors could hold more cash, or look to higher-yielding sectors such as utilities, real estate and telecoms, given Canada will likely remain stuck with low interest rates for some time.

The Toronto Stock Exchange’s S&P/TSX composite index ended up 49.78 points, or 0.38 percent, at 13,084.16, with nine of the index’s 10 main groups in positive territory.

The heavyweight financial group was barely higher overall, although some of the biggest banks weighed. Bank of Montreal lost 1 percent to C$77.89 and Toronto-Dominion Bank slipped 0.4 percent to C$54.60.

Brookfield Asset Management Inc gained 0.6 percent to C$43.90. Australia’s antitrust regulator said it will consider a watered down version of the infrastructure giant’s $6.5 billion bid for freight firm Asciano Ltd, reviving the prospect of a deal.

Dominion Diamond Corp surged 22.5 percent to C$14.06. It said it is working with bankers to find ways to boost shareholder value, possibly including a sale.

Centerra Gold fell 5.6 percent to C$6.79 after Kyrgyzstan’s government said it had stopped talks with the company on restructuring their joint Kumtor project because the current agreement “ran counter to the country’s national interests.”

The overall materials group rose 0.7 percent, while energy stocks eked out a marginal gain, helped by pipeline companies.

Enbridge Inc was up 2.3 percent at C$44.58 and TransCanada Corp rose 1.3 percent to C$45.25.

In contrast, Encana Corp fell 5.2 percent to C$6.52.

U.S. crude prices settled up 0.9 percent at $36.37 a barrel, while Brent crude fell slightly to $36.33.

Valeant Pharmaceuticals International Inc rose 4 percent to C$158.09. (Additioanl reporting by Fergal Smith; Editing by Meredith Mazzilli and Dan Grebler)