COLOMBO, May 22 (Reuters) Sri Lankan stocks ended slightly weaker on Monday as investors worried a spike in violence since early April could spiral into renewed civil war, traders said, citing increasing uncertainty in the market.

The Colombo All Share <.CSE> index fell 0.28 percent to close at 2,219.73 points. Turnover was less than the recent daily average at 119 million rupees ($1.15 million). The market is up around 15 percent so far this year.

While a truce still technically holds, there are near daily ambushes, shootings and skirmishes in the north and east and the Tigers warned on Monday the military was pushing them towards a ''high intensity war'' after a top rebel commander was assassinated in the island's east late on Sunday.

''The market is slightly weaker, with less activity as investors stand by to see the direction the country takes,'' said Susil Fernando, investment advisor at DFCC stockbrokers in Colombo.

Market heavyweight and leading mobile operator Dialog Telekom rose 1.16 percent to 21.75 rupees a share, while conglomerate John Keells Holdings gained 0.51 percent to close at 148 rupees a share.

Fuel retailer Lanka IOC Ltd. closed 4.0 percent weaker at 24 rupees a share after reporting a full-year net loss of 7.07 billion rupees on Friday.

The company blamed an unpaid 7.44 billion rupee subsidy payment at the centre of a dispute with the government.

Sri Lanka's rupee closed a shade weaker at 102.99 to the dollar, compared to Friday's close of 102.95/102.98.

''The rupee weakened with huge importer demand for dollars,'' said one trader. ''One state bank sold dollars in the market. I believe that was on behalf of the Central Bank.'' ''If the Central bank intervention was not there, it would break 103 levels and I believe it will go up to 103.40,'' he said.

Call rates in the brokers' market were 10.408 percent, compared to 10.418 on Friday.

REUTERS CS ND1728