LONDON, June 3 (Reuters) - Copper fell on Wednesday as concerns about the outlook for demand persisted, but aluminium found some support from the first stocks draw in six weeks. Benchmark copper on the London Metal Exchange traded at $4,970 a tonne in official rings from $5,050 on Tuesday. Aluminium traded at $1,473 a tonne from $1,472, having hit a day's high of $1,493.25. Stocks of aluminium dropped by 1,125 tonnes but were still above 4.2 million tonnes, having hit record highs on a daily basis since April 20. However, the outlook for the over-supplied aluminium market remains dire, ahead of a potential series of production restarts in China and as economic turmoil continues to punish the auto sector. "Aluminium is still a market in substantial surplus," said analyst Adam Rowley at Macquarie Bank. "We are getting to a position where stocks are getting so high that they could take years to wear off, even with demand recovering." Possibly signalling the worst of the aluminium supply overhang has passed, cancelled warrants -- metal tagged for delivery -- rose to 78,200 tonnes from 56,875 tonnes on May 1. COPPER ON A LEASH Falls in stock markets and a rising dollar weighed on copper as a stronger dollar makes metals priced in the U.S. currency more expensive for holders of other currencies. Prices of copper, used in power and construction, have gained about 5 percent so far this week, hitting a 7-1/2 month high of $5,145 on Tuesday, as investors welcomed a recent spate of above consensus economic data. But analysts warned copper's recent strength masks poor fundamentals. Markets are entering a seasonally quiet period at a time when Chinese restocking -- which has helped lift copper by about 60 percent year-to-date -- appears to be subsiding. "Markets have run ahead of fundamentals," said Robin Bhar, an analyst at Calyon, adding that copper's recent rally was based largely on "expectations and hope ... not reality". But supporting sentiment was a fall in stocks of copper, down 2,700 tonnes to 306,525 tonnes. Later in the session investors will eye data including U.S. ISM non-manufacturing data and U.S. factory orders data, both due at 1400 GMT. Among other industrial metals zinc traded at $1,557 from $1,580, battery material lead at $1,625 from $1,659, having earlier touched $1,677.50, its highest since early October. Tin was untraded but last bid at $14,550 from $14,500 on Tuesday. Cancelled warrants stood at 1,465 tonnes -- about 10 percent of total stocks -- up from 320 tonnes last week. Pointing to worries about tin supplies is the high premium of about $260 a tonne for cash material over the three-month contract. Nickel traded at $14,375 from $14,620 on Tuesday. Earlier it hit $14,800, its highest since early October. Metal Prices at 1228 GMT Metal Last Change Percent Move End 2008 Ytd Percent move COMEX Cu 229.65 0.00 +0.00 139.50 64.62 LME Alum 1468.00 -4.00 -0.27 1535.00 -4.36 LME Cu 4986.00 -64.00 -1.27 3060.00 62.94 LME Lead 1625.00 -34.00 -2.05 999.00 62.66 LME Nickel 14310.00 -310.00 -2.12 11700.00 22.31 LME Tin 14550.00 50.00 +0.34 10700.00 35.98 LME Zinc 1553.00 -27.00 -1.71 1208.00 28.56 SHFE Alu 13075.00 230.00 +1.79 11540.00 13.30 SHFE Cu* 40640.00 950.00 +2.39 23840.00 70.47 SHFE Zin 13330.00 210.00 +1.60 10120.00 31.72 ** 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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