* Poor U.S. data on Tuesday clouds macro economic outlook * Zinc gains on short-covering * COMING UP: U.S. new home sales data for May at 1400 GMT (Recasts, updates prices and comments, changes dateline from MANILA) By Humeyra Pamuk LONDON, June 23 (Reuters) - Copper edged up on Wednesday as the dollar fell but gains were capped as unexpectedly poor U.S. housing data in the previous session revived concerns about the strength of global economic recovery. Traders expected a sideways session in the absence of fresh fundamental news and as the market looked for direction after the initial euphoria over changes to China's currency policy faded and technical charts pointed to a consolidation. Copper CMCU3 for three months delivery on the London Metal Exchange rose to $6,625.50 a tonne by 0851 GMT, versus $6,610 a tonne at the close on Tuesday. "The dollar is a bit weaker and gold is up," said RBC Capital Markets trader Randy North, citing it as the reason why copper is in positive territory. "There's some short covering going on in zinc, pushing prices higher," he said. Zinc CMZN3, used to galvanise steel, gained nearly 2 percent to $1,822.50 a tonne. The euro held steady but remained vulnerable as a recent risk rally appeared to have run its course and on concerns about the euro zone banking system. [FRX/] Copper, used extensively in construction, struggled to extend its gains as an unexpected fall in the sales of existing U.S. homes in May clouded the outlook on the global economy. "The more pressing issues are things like the housing data in the U.S. yesterday," said Will Adams, analyst at Basemetals.com. "If we start seeing slightly disappointing data in the U.S. plus austerity measures in Europe, the direction for metals could be downside," he said. Investors will be watching new home sales data from U.S. due at 1400 GMT and will also monitor what the Federal Open Market Committee will say on economic outlook after a two-day meeting ends on Wednesday. [ID:nFEDAHEAD] "The market is a bit directionless right now," said David Moore, commodity strategist at Commonwealth Bank of Australia. "There's still concerns about Europe and the pace of recovery in the U.S., but in the same token I think the medium-term outlook remains one of international economic recovery," he said. LME copper may consolidate further with the price still trapped between $6,470 and $6,729.75 per tonne and looking for direction, said Reuters market analyst Wang Tao. [TECH/C-MET] Aluminium CMAL3 was $11 higher at $1,960 a tonne, shrugging off a rise of 6,325 tonnes in inventories, bringing the total to 4.46 million tonnes, around 200,000 tonnes away from a record high struck in January. The fact that the bulk of the material being tied up into financing deals is making the nearby market tight, despite high inventories. And the need to finance the pile of metal could give a boost to plans to launch exchange traded funds (ETF), an executive at the top aluminium producer said. "There is still plenty of risk capital around to finance metal ... It's one of the reasons why the ETFs are becoming more attractive," said Greg Wittbecker, director of material management with Alcoa (AA.N) told Reuters. [ID:nN22700708] Battery material lead CMPB3 was at $1,835 a tonne, versus $1,828 a tonne, while tin CMSN3 was at $18,100 a tonne from $18,150. Nickel CMNI3 edged up $20 to $19,670 a tonne. Metal Prices at 0914 GMT Metal Last Change Pct Move End 2009 Ytd Pct move COMEX Cu 297.95 -1.25 -0.42 334.65 -10.97 LME Alum 1950.00 1.00 +0.05 2230.00 -12.56 LME Cu 6609.00 -1.00 -0.02 7375.00 -10.39 LME Lead 1825.00 -3.00 -0.16 2432.00 -24.96 LME Nickel 19550.00 -100.00 -0.51 18525.00 5.53 LME Tin 17950.00 -200.00 -1.10 16950.00 5.90 LME Zinc 1814.00 21.00 +1.17 2560.00 -29.14 SHFE Alu 14820.00 45.00 +0.30 17160.00 -13.64 SHFE Cu* 53130.00 290.00 +0.55 59900.00 -11.30 SHFE Zin 15050.00 240.00 +1.62 21195.00 -28.99 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07 (Additional reporting by Manolo Serapio Jr. in MANILA, Editing by Alison Birrane)

Source