* Westpac slips as regulator flags higher capital requirement
* Lynas tumbles, fails to secure government nod for increase in processing limit
* Gold stocks tumble nearly 2% to weigh heavy on index
By Rashmi Ashok
Dec 17 (Reuters) - Australian shares managed to gain modestly on Tuesday, as a troubled financial sector and steep tumble in gold stocks offset upbeat data from China, the country's biggest trading partner.
The S&P/ASX 200 index .AXJO was up 0.1%, or 5.9 points, at 6,855.6, as of 0037 GMT. The benchmark closed 1.6% firmer on Monday.
Data on Monday showed that China's industrial output and retail sales growth accelerated more than expected in November, offering further impetus to risk appetite. got a further boost after a top White House adviser said late Monday the "phase-one" trade deal between the United States and China has been "absolutely completed," adding that U.S. exports to China will double under the agreement. the positive cues, gains were limited as deep losses in gold miners and the 'Big Four' banks added pressure to the index.
Safe-haven gold stocks .AXGD slumped nearly 2%, with top gold miner Newcrest Mining Ltd NCM.AX falling 1.7%, while Evolution Mining EVN.AX and Saracen Mineral Holdings SAR.AX shed 2.2% and 0.8%, respectively.
Financial stocks .AXFJ continued to be plagued by regulatory troubles.
Shares of Westpac Banking Corp WBC.AX marked their worst session in nearly two weeks after a banking regulator said it will investigate the lender over the recent money laundering allegations it faces.
to woes, the regulator said Westpac will be required to hold an extra A$500 million in capital to reflect its increased operational risk profile.
Australia and New Zealand Banking Group ANZ.AX ticked down while its 2019 AGM proceedings were underway.
In an address to shareholders, Chief Executive Officer Shayne Elliott said the lender was not aware of any impending litigation by the country's regulator, AUSTRAC, regarding its money-laundering controls. Bank of Australia CBA.AX fell 0.4%, while National Australia Bank NAB.AX dipped.
Helping limit losses on the main bourse were index heavyweights BHP Group Ltd BHP.AX and rival Rio Tinto (LON:RIO) Ltd RIO.AX , which added 0.7% and 0.8% respectively, while Fortescue Metals Group FMG.AX tacked on 1.2%.
On the downside, rare earths miner Lynas Corp LYC.AX dropped nearly 6% to its worst session since August, after the company failed to secure approval from a Malaysian regulator to increase its lanthanide concentrate processing limit for 2019. Zealand's benchmark S&P/NZX 50 index .NZ50 rose 0.4% to 11,277.16.
New Zealand-listed shares of Westpac slipped 1%, while dairy company Synlait Milk SML.NZ lost 0.4%.