* TSX up 0.7%

* Tech share biggest gainer, energy shares slump

* Air Transat gains on new deal with union

Jan 8 (Reuters) -

Canada's main stock index gained on Monday, boosted by tech stocks even as energy shares weighed down the index.

The Toronto Stock Exchange's S&P/TSX composite index was up 137.36 points, or 0.66%, at 21,074.91.

Mirroring the trend on Wall Street, Canadian technology shares, which took a beating last week, recouped some losses to rise 2.9%, with Shopify among the top gainers as it rose 4.2%.

"We are seeing the tech sector boosting equity markets as investors are returning to the sector after last week's pullback," said Angelo Kourkafas, senior investment strategist at Edward Jones.

In New York, megacaps such as Amazon.com and Alphabet gained as Treasury yields fell ahead of readings on inflation and a new supply of government debt this week.

The healthcare sector rose 1.9%, led by gains in Tilray Brands, which is scheduled to report its earnings this week.

Energy stocks shed 2% as oil prices fell by more than 3% on sharp price cuts by top exporter Saudi Arabia and a rise in OPEC output.

The materials index slid 0.1% as gold prices hit a three-week low.

The commodity-heavy TSX had a shaky start to 2024 due to fading optimism around the prospect of early rate cuts from the Federal Reserve.

"If the central banks actually do start cutting interest rates, it would mean that we're heading into a recession," said Colin Cieszynski, portfolio manager and chief market strategist at SIA Wealth Management.

"Canada may be in a recession already, and the U.S. may not be that far behind."

Investors are now gearing up for the quarterly earnings season, which big U.S. banks will kick off on Friday. Data on U.S. consumer prices due on Thursday will also be on the watchlist for further cues on the interest rate path.

Shares of Air Canada rose 3.4% after it said more consumers flew its airlines during the holiday.

Canada Goose Holdings and Bombardier rose 4.7% and 6.9% respectively on price target upgrades.

Air Transat

gained 4.2% after the Canadian leisure carrier agreed a new labor contract with the Canadian Union of Public Employees. (Reporting by Amruta Khandekar and Purvi Agarwal in Bengaluru and Nivedita Balu in Toronto; Editing by Ravi Prakash Kumar and Deepa Babington)