By Anna Stablum LONDON, Dec 2 (Reuters) - Aluminium touched a 3-1/2 year low and lead fell 4.3 percent on Tuesday ahead of U.S. car sales data that is expected to show another grim picture of slowing demand. Reports that a second Chinese state is considering buying metals to help support prices had little effect on the market which focussed on rising London Metal Exchange inventories. "Rising stock levels in copper and aluminium is daily evidence that demand is less than supply," analyst David Thurtell at Citi said. "The metals are tracking the equities market," he added. Most metals trimmed losses by midday as European shares turned higher, following a recovery in oil. Copper for delivery in three months fell $31, or 0.9 percent, to $3,559 a tonne by mid-session. Earlier in the session it touched $3,475 and copper -- often seen as a key gauge of real economic activity -- hit a 3-1/2 year low of $3,375 on Nov. 21. Prices for the metal, used in construction and power, have slumped around 60 percent since a record $8,940 a tonne in July. Aluminium fell to $1,701 a tonne, after hitting a 3-1/2 year low of $1,697 from $1,735 on Monday. Stocks of aluminium -- used in transport, construction and packaging -- jumped 2,725 tonnes to 1.83 million tonnes, the highest level since December 1994. The light metal is down by almost 30 percent and battery material lead is down by around 60 percent this year. Lead fell to $1,068 from $1,100. In early trade it fell to $1,052 -- the lowest since mid-2006 -- on concerns about demand for batteries going into the automotive sector. Plans by China's minerals-rich border region of Guangxi to consider purchasing metals came a day after Yunnan province said it would buy up to 1 million tonnes of base metals and minerals and hold them for one year to help shore up prices. Tin rallied 5.7 percent on the news on Monday, but settled lower due to the lack of concrete details about the stocks scheme. It was at $12,000 against $12,370 late on Monday. OTHER MARKETS RECOVER European shares were up by midday as energy companies recovered with crude prices turning back up and the FTSEurofirst 300 index index of top European shares up 0.9 percent at 817.30 points, after falling 6 percent on Monday. Oil, which was down 3 percent at below $48 a barrel earlier, regained some ground to trade above $49.41 by 1251 GMT. London-listed miners Antofagasta, Vedanta and Kazakhmys gained between 5 and 9 percent. Attention was on U.S. auto sales data due later on Tuesday and factory orders and non-farm payrolls for November towards the end of the week. The dollar was also influencing metals prices, traders said. "Prices have narrowed earlier losses as the euro is gaining against the dollar," one LME ring dealer said. A weaker U.S. currency makes dollar-priced metals cheaper for holders of other currencies. LME zinc fell $5 to $1,161 and technical analysts pegged the chances of higher prices as slim. "Downside pressure is consistent so rally success is limited," Daryl Guppy, managing director of Guppytraders.com said, adding: "The move below the trend line at $1,210 has a downside target near support at $1,050." Stainless steel material nickel fell $100 to $9,700. Metal Prices at 1312 GMT Metal Last Change Percent Move End 2007 Ytd Percent move LME Cu 3540.00 -50.00 -1.39 6670.00 -46.93 SHFE Cu* 27080.00 -960.00 -3.42 56880.00 -52.39 LME Alum 1701.00 -34.00 -1.96 2403.00 -29.21 SHFE Alu* 12065.00 -525.00 -4.17 18180.00 -33.64 COMEX Cu** 158.15 -2.20 -1.37 303.05 -47.81 LME Zinc 1156.00 -10.00 -0.86 2370.00 -51.22 SHFE Zinc* 9525.00 -235.00 -2.41 18950.00 -49.74 LME Nick 9700.00 -100.00 -1.02 26350.00 -63.19 LME Lead 1064.00 -36.00 -3.27 2550.00 -58.27 LME Tin 11850.00 -450.00 -3.66 16400.00 -27.74 ** 1st contract month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07

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