UPDATE 2-Cellphone market fall ended in Q3 -Gartner

* Global cellphone sales to consumers grew 0.1 pct y/y in Q3 * raises 2009 market view to flat y/y from 4 pct fall * says grey market volumes at 150 mln phones * sees 2010 volumes rising 5-8 pct y/y, boosted by grey market

(Adds details on grey market, analyst)

By Tarmo Virki, European technology correspondent

HELSINKI, Nov 12 (Reuters) - The fall in the handset market stopped in the third quarter, helped by clearing of inventories of unsold phones and booming sales on the so-called grey market in countries like China, research firm Gartner said on Thursday.

Handset sales saw sharp drops earlier in the year as consumers around the world cut back on spending in the economic downturn.

However, most of the top handset vendors are missing out on growth as around 150 million phones this year will be manufactured on the grey market, by Chinese manufacturers without production licences, Gartner said.

This compares with the 117 million phones that LG Electronics (066570.KS), the world's third-largest handset maker, is expected to sell this year. [ID:nL9503229]

Most of the grey-market phones use chips from Mediatek (2454.TW).

Some of them are copies of models made by top vendors, using brand names like Mokia, but many are not, Gartner said.